Who just got stung on stamp?

Peace · 02-12-2004 10:03am #1

With the reduction on stamp duty just announced I can imagine a lot of people being pretty pissed off!

Personally I'm saving for my downpayment, which just got a hell of a lot cheaper. My budget would be in the region of 200k (possibly more now) so my down payment went from about 22k (6k on stamp) to 16k. They are rough figures.

If it had happened to me, that i had just spent a long time scraping money together, and then to see the tax abolished... man oh man. :mad:

All said and done, i think most people would agree that its a very positive move towards helping out first time buyers. Its was bad enough without the government taking a huge wad of cash on top of the downpayment.

Beruthiel · 02-12-2004 2:02pm

why they don't just get rid of stamp duty altogether is beyond me, houses are so expensive and on top of that you have to figure in an extra 4/5% on top of that

frodi · 02-12-2004 2:23pm

They won't get rid of it because it brings in too much money, high property prices + high stamp duty = bonanza for govt.
It discourages mobility in market. If I need a bigger house it is cheaper for me to build a huge extension than pay the property tax alone ( never mind solrs, estate agents et al)

Peace · 02-12-2004 3:26pm

Weel yeah, its like asking why they don't get rid of VRT since the EU are hammering them to stop it.

Cost of disobeying Eu Commmiss v's Cost of getting rid of VRT.

I'm sure they would have loved to keep stamp in place but they are looking forward tot he next election.... after saving the cash the past couple of years its now back to hearts and minds. Today all the 1st time buyers are jumping up and down... where as they were screwed when the 1st buyers grant was pulled to save money.

Cynical, but correct me if i'm wrong.

magpie · 02-12-2004 3:30pm

why they don't just get rid of stamp duty altogether is beyond me

I'll second that emotion, having forked out over €30K to the government in stamp duty in 2 house moves. I wouldn't mind it if was being used to improve infrastructure, provide affordable housing or indeed anything that I could point at and say "Now I know why I have to pay Stamp Duty", rather than just being a nebulous tax that disappears into the Govt's coffers.

It's massive extension time for me next time.

frodi · 02-12-2004 4:21pm

Peace wrote:

Weel yeah, its like asking why they don't get rid of VRT since the EU are hammering them to stop it.

Cost of disobeying Eu Commmiss v's Cost of getting rid of VRT.

I'm sure they would have loved to keep stamp in place but they are looking forward tot he next election.... after saving the cash the past couple of years its now back to hearts and minds. Today all the 1st time buyers are jumping up and down... where as they were screwed when the 1st buyers grant was pulled to save money.

Cynical, but correct me if i'm wrong.

Not cynical, realistic. I wonder how many will remember the "they screwed us now they love us" come the next election.
I love elections, the nearest to ethical blood sports thta we have. Some people like foxes, hares and badgers, nobody likes politicians.

madmorphy · 03-12-2004 3:43am

I bought a property as a first time buyer a few years ago,i'm now looking to buy a new apartment less than 125sq Meters to move into and rent out my existing property.Will i be screwed for Stamp Duty ?Answers from people who have actually experienced this would be much appreciated.

Victor · 03-12-2004 4:25am

See http://www3.myhome.ie/news/news_show.asp?p=1&id=1489

Peace · 03-12-2004 9:07am

Victor wrote:

See http://www3.myhome.ie/news/news_show.asp?p=1&id=1489

Thanks Vistor, I've been looking for Mortgage Interest Relief information and thats pretty good article.

A question for everyone though...

Where it is their first purchase, these figures are increased to €4,000 for a single person and e 8,000 for married couples or a widower. These increased limits apply for the first seven years, thereafter the amounts fall back to €2,540 and €5,080 respectively.

The relief given is always at the standard rate which is 20% for the tax year 2004. Where the interest actually paid in a tax year is below the limits quoted above, the relief is restricted to the actual interest paid.

From 1 January 2004, mortgage interest relief is granted at source. This means that the relief will now be granted by the bank / lending institute involved and will no longer be included in your tax free allowance certificate or your annual income tax return. Thus, an individual's monthly mortgage payments should be reduced by the tax relief available. However, the onus is on the taxpayer to contact their bank / lending institute to ensure that they have all relevant particulars of the borrower so as to enable them to reduce their mortgage by the relevant sum.

<edit> forget i asked... i rered the bit that answered what i asked</edit>

I'm trying to get a picture of what my expenses will be when i finally get my deposit together and makle a move on a house... maybe next march/april.

Victor · 03-12-2004 9:15am

Peace wrote:

Thanks Vistor, I've been looking for Mortgage Interest Relief information and thats pretty good article.

As best I know it is the interest only part. This tends to favour new buers.

Peace · 03-12-2004 9:18am

After rereading the article, slowly this time, i spotted this...

the relief is restricted to the actual interest paid.

GreeBo · 03-12-2004 4:43pm

The bit that bothers me is that if you go €1 over the nearest bracket you get hammered.
I'd prefer if they worked it in the same way as income tax.
Then they could stick an extra 0.5% on every €50k over the bracket.
i.e.
€300k = 0%
€350k = 4% (but only on the €50k)
€400K = 4% on the first €50k and 4.5% on the other 50k
or does that make no sense?

So if you are in the market for a €900k house you pay differently for it as you are obviously in a different position than they guy looking at a €400k house.

FX Meister · 03-12-2004 4:52pm

madmorphy wrote:

I bought a property as a first time buyer a few years ago,i'm now looking to buy a new apartment less than 125sq Meters to move into and rent out my existing property.Will i be screwed for Stamp Duty ?Answers from people who have actually experienced this would be much appreciated.

Yes, you will have to pay the stamp duty. I bought my first house in May, it was a second hand house so I had to pay duty, although at .5% cheaper than the normal rate. I'm in the process of buying a second house now and I have to pay the stamp duty. Someone else argued this in another thread but they had read the info wrong. I talked to my solicitor yesterday to confirm this.

TheWanderer · 06-12-2004 9:19am

Yes, you will have to pay the stamp duty

No he won't have to pay stamp duty on the new property as new property under 125sqr m is exempt from stamp duty , doesn't matter if you are a first time buyer or not.

However (and he'd need to check this with his solicitor) he may be liable to a stamp duty clawback on his first house if he rents it out within 5 years of purchase.

TW

FX Meister · 07-12-2004 3:08pm

Sorry Wanderer but you are mistaken, he will have to pay the stamp duty if he has already owned a property. Taken from myhome.ie

Houses/Apartments less than 125 sq. metres
For persons buying new homes/apartments, there is a full exemption from stamp duty for first-time buyers and owner-occupiers (but not investors) provided the structure has a floor area certificate issued by the Department of the Environment.

He said he was not a first time buyer, as you can see above it only applies to first time buyers and owner occupiers.

tiktok · 07-12-2004 4:48pm

FX Meister wrote:

He said he was not a first time buyer, as you can see above it only applies to first time buyers and owner occupiers.

.....but he will be an owner-occupier if he's buying the apt. for himself and living there, so stamp duty will not apply.

FX Meister · 08-12-2004 11:45am

Maybe read what it says correctly, there is a full exemption from stamp duty for first-time buyers and owner-occupiers. You must be a first time buyer as well as being an owner occupier. Meaning if it is your first time buying a house and you are buying it to rent out then stamp duty still applies. If it is your first time buying a house and you will be the owner and living there you will not pay stamp duty. If it is not your first time buying a house but you intend to be the owner occupier you will have to pay stamp duty. I am in this situation at the moment, I have confirmed this with my solicitor as well as other sources.

Andrew Duffy · 08-12-2004 2:54pm

It's pretty simple. For owner-occupiers of new property above 125 sqm, stamp duty is payable on the higher of the site cost or one-quarter of the total pre-vat cost. Since this is often below the second-time buyer's exemption limit of €127,000, many large new houses are advertised as stamp duty exempt.

http://www.oasis.gov.ie/housing/buying_a_house_or_flat/stamp_duty.html [Victor]Link fixed[/Victor]

TheWanderer · 09-12-2004 11:38am

Maybe read what it says correctly, there is a full exemption from stamp duty for first-time buyers and owner-occupiers. You must be a first time buyer as well as being an owner occupier. Meaning if it is your first time buying a house and you are buying it to rent out then stamp duty still applies. If it is your first time buying a house and you will be the owner and living there you will not pay stamp duty. If it is not your first time buying a house but you intend to be the owner occupier you will have to pay stamp duty. I am in this situation at the moment, I have confirmed this with my solicitor as well as other sources.

FX,

Your solicitor is wrong. madmorphy said he was buying a new property under 125 sq meters to live in i.e. it will become his PPR. Therefore no stamp duty - doesn't matter whether he's a first or second or third time buyer.

This is a fact - call the revenue they will confirm this.

TW

Who just got stung on stamp?

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