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Stamp Duty on Inherited property??

  • 08-07-2009 4:21pm
    #1
    roseinthegarden
    Closed Accounts Posts: 9 ✭


    Hi

    Just wondering would I have to pay stamp duty as well as inheritance tax if i decided to buy my fathers house and pay off my siblings their share that I would owe back to them??

    If you inherit a number of properties are we going to be hit with inheritance tax and/stamp duty or each of us decide to move into one of the properties instead of selling them.

    Wondeirng as the market is so rubbish at the moment?? better off not selling but keeping them and living in them ourselves


Comments

  • #2
    Mr. Incognito
    Registered Users, Registered Users 2 Posts: 9,798 ✭✭✭Mr. Incognito


    Hi Rose and welcome.

    Firstly specific advice around here is banned (read the charter) but I can tell you about a few general reliefs. At the outset you these are only general suggestions and should never be relied on to replace competent professional advice which I would urge you to seek.

    When a house is sold CAT applies to the buyer and CGT to the seller. Depending on the relationship between the parties there is a CAT threshold that is tax free. In addition if it is the family home dwelling house exemption may apply (see below)

    There is a general GCT /CAT set off whereby if the same event triggers both a set off is available.

    The gifts to siblings for shares in the family home will attract CAT (less thresholds) for them.

    In the realm of CGT the CGT is computated on the difference between the original purchase price (as indexed) and the sale price.

    Further info

    As for stamp duty relief known as consanguinity relief may apply to reduce stamp duty by 50% but if you are a first time buyer this may not be an issue.

    Consanguinity relief:
    http://www.revenue.ie/en/tax/stamp-duty/leaflets/sd10a.pdf

    Dwelling house exemption
    http://www.revenue.ie/en/tax/cat/leaflets/cat10.pdf

    An exemption from Gift Tax or Inheritance Tax in respect of a dwelling house exists where the beneficiary has been living in the house for 3 years prior to the gift or inheritance and stays there for a further 6 years. The beneficiary cannot have an interest in any other residential dwelling. In the case of a gift, this exemption will not apply if the disponer lived in the house for the 3 year period before the gift, unless the person giving the gift was required, due to ill-health or infirmity, to depend on the services of the donee for that period.

    Finally don't forget VAT :) There are new VAT rules that have come into effect. However if a property has not been developed in the last 5 years generally it is VAT exempt.

    Hope that helps.


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