# flipping and tax matters



## Luternau (7 Oct 2006)

I am trying to get a refund of VAT on new property bought for investment. Does anyone know how to go about getting an invoice in my name for the full amount of the purchase price paid for property bought through a sub sale. Flipper says they have no liability to supply one, yet the builder says I am not the person they had the contract with.
Either way they could only supply an invoice for the original sales price which result in my submitting an invoice for a lower sales price. 
Surely there is some precedent for this. The properties were new when I go them so VAT should be chargeable on the premium sales price.
Sounds dodgy -from a tax avoidance perspective(legal or otherwise)


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## liteweight (8 Oct 2006)

This is an interesting one!! If the flipper is not registered for vat, then s/he cannot supply you with a vat invoice. If the contract with the builder is not in your name, then he can't supply you with one either. Even if it was possible for the builder to supply the invoice, it couldn't be for the amount you paid because some of that payment went to a third party, i.e. the flipper! Have you spoken to your solicitor?


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## Luternau (8 Oct 2006)

You have nailed the issue there in one-its a dilema or classic catch 22. 
I have spoken to my solicitor and I seem to know more that he does.
According to the Revenue VAT section in Dublin Castle-(the specific expert on it), VAT is due on an assignors (flippers) markup, whether or not they are registered for VAT. This occurs as the goods (property) is sold new and therefore liable for VAT at the full price even if it ges through an intemediary. Seller does not agree and says they are exempt.
As it stands i am in limbo with my vat refund claim. 
You have insight on this?


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## liteweight (8 Oct 2006)

I have reclaimed VAT myself but I've no insight into your particular situation. Our solicitor hadn't a clue either, and it wasn't something our usual accountant specialised in. We ended up doing our own research. I have to say the staff at the VAT office were extremely helpful.

The only thing I can say is that, presumably the builder's invoice will be included in the paperwork for the sale. This might be a reduced VAT amount  but, as the VAT has to be paid back eventually, some might be better than none....if you know what I mean.

I presume the VAT office meant that VAT was included in the flipper's markup.....so maybe you can take that aspect into account also.


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## Macer (9 Oct 2006)

I would have thought that the Flipper would be considered as carring on a trade (buying & selling houses) and would be obliged to register for VAT as the value of the house would be over the vat threshold which requires you to register. The flipper would also be liable to Income Tax and not CGT from his profits.
If I was the flipper I would pull the sale and look for someone who does not require a vat invoice and treat this transaction like everyone else (ie. keep the head down and hope the revenue don't come looking!!!!!!!!).


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## Luternau (9 Oct 2006)

Thanks for the replies,

Sale has gone through. Bulider refuses to give me invioce in my name for the original sale price, citing that they had no contract with me. A but inflexible, as VAT is already paid, so is should not matter to them who's name is on the invoice.

 I agree that this should be treated as trading income as the and it is above the threshold which is exempt from registration for VAT.  Flippers beware that its not all plain sailing into the sunset with massive profits! Perhaps its best to close sale, pay stamp duty and sell. Profit subject to CGT at 20%, which is better that a VAT due bill and income Tax at 42% plus penalties if investigated.

Anyone got anymore ideas on how to proceed?


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## ubiquitous (16 Oct 2006)

Luternau said:


> Thanks for the replies,
> 
> Sale has gone through. Bulider refuses to give me invioce in my name for the original sale price, citing that they had no contract with me. A bit inflexible, as VAT is already paid, so is should not matter to them who's name is on the invoice.



On the contrary this matters a great deal to the builder. If a third party (ie, you) uses an invoice in order to secure a VAT repayment, and the invoice turns out to be fraudulent (ie, representing a transaction that never actually took place), then there would be serious implications for the builder. The www.odce.ie website lists the details of at least one case where a building company were prosecuted for failure to maintain proper books of account after being caught up in a high-profile scam involving VAT reclaims and misleading invoices.


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## Luternau (16 Oct 2006)

The VAT was paid by the builder so there is no worries on this front. Its getting an invoice in my name for the price that I paid that is the problem
I know that the Revenue will not refund me VAT on the full sales price, without knowing if VAT has been paid on the full sales price. If VAT is chargeable on the Assignors markup, surely the assignor should be registered for VAT as the amounts here exceed the exemption threshold.

Regarding SPC100 request;

The original purchser agreed to surrender his rights and interest in the property for a fee (assignors mark up). Does this mean that they are selling contracts or property? If it is a contract would the contract be regarded as exempt from VAT or would it be regarded as goods?   The agreement also said that I would pay 'such VAT to the assignor that may become due'. This is a strange clause as the parties that rule on such matters -the revenue-were not aware of the agreement.  Remember Revenure have said that VAT is due on an assignors mark up-and that is about the sum of their assistace in this to date,

It seems to me an attempt by the assignor to avoid charging VAT. Surely all Vatable goods should have VAT included in the price payable to the vendor? Unless exempted of course. How many purchasers are going to self declare a liability to pay a few thousand in VAT?


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## liteweight (16 Oct 2006)

It's a confusing subject. It all comes down to who you bought the property from I suppose. In the case of flipping, the property seems to remain somewhere in the ether!! I agree with Ubiquitous, the builder cannot provide a VAT invoice if you did not buy the property from him. I suspect that most flippers sell to people who do not wish to reclaim VAT.

When the flipper paid a deposit, this would have been VAT inclusive but s/he probably does not reclaim it if they are not registered.


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## Luternau (16 Oct 2006)

Yes its a confusing one alright and I am in the middle of it!

As far as I am concerned I bought from the flipper- who advertised the property for sale-not the contract, and duly entered into a contract to sell. I was happy to purchse at the price offered,they made their profit-fair play to them them.

Whether they are registered or not for VAT is not my concern.  They seem very quick to refer me to the builder when, as has been pointed out by posters, and I am aware of myself, I had no contract with. The builder has supplied an invoice in the name of the the original purchaser-which is of no use to me when dealing with the revenue!

Anybody know any good accountants that specialise in VAT and wont bill me to heavily? May need to change my solicitor too as he has been of no help.

In the wise words of the greatest philosopher of modern times-Bart Simpson ! "you are damned if you do and damned if you dont"

Maybe I will wake up soon and smell the ether!


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## liteweight (16 Oct 2006)

I think it does make a difference whether someone is registered or not. Property sales/rentals are not usually subject to VAT unless it's a new build or the owner has waived their right to exemption. At the moment, for example, if I sold you an apartment, the price would be VAT inclusive and I would have to pay that over to Rev. That was our choice but as far as property in general is concerned VAT does not have to be charged unless the owner has waived his exemption AFAIK.


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## Luternau (16 Oct 2006)

Think that VAT is chargeable on all new property. New property being described as property that has not previoulsy been registered  in the state with the land  registry.
On this basis -the property I purchased qualifies.  As the flipper did not pay stamp duty. If the flipper had of close the sale and paid stamp duty, then the property would not be new, and could be sold on, without liability to VAT. That though would have reduced the profit of the flipper-which they did not want to do. May I add that this was done on a wholesale with many units (x10's) being sold this way.
If you think about it like this-flipper buys off plan in phase one for say 100k in 2005, Developer puts phase one market in 2006 and is sells out all identical units for say 125k (which includes VAT at 13.5%) Non VAT registered Flipper later agrees to sell to me  (before completion) for 125k(or more)-Both properties are identical, both ready at the same time, but one has a higher proportion of VAT -just because the developer sold it. It does not make any sense that such a high priced object could be exempted just because its more profitable not to be VAT registered. 

AFAIK there is case history of the revenue persuing people who have used revenue laws as a means of tax avoidance-which they in certain instances determine to be tax evasion.


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## liteweight (16 Oct 2006)

Curiouser and curiouser....Luternau, I presume you're registered for VAT already because if not, all of this is moot really.

When an owner/occupier buys from a flipper they don't have stamp duty liability (under 125 sq.mt.) as the property is deemed new. Presumably it's the same for anyone buying from a flipper?? You may still have a case with regard to getting a VAT invoice out of the builder. He did not sell the property to the flipper, but sold an interest in it. The larger portion of the property still belonged to the builder and you bought the flipper's interest plus the builders share.


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## extopia (16 Oct 2006)

This thread is too bizarre. Sounds like the VAT reclaim idea may have been an afterthought?


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## Luternau (16 Oct 2006)

Yes I am registered for VAT. For the record, I did not purchase 10's-that is the number of properties flipped. Not to be sneezed at. If I were the revenue my nose would definately be getting sniffly...
SPC100 is probably not far off the truth when saying that the builder could give me an invoice in my name as the person that bought its majority interest in the premises. IUnfortunately they do not see it this way-and keep saying that we had no agreement. They are technically wrong in issuing an invoice in the name of the flipper-who actually bought nothing.

At this stage I think that UI have to get professional advice -and based on that take appropriate action. What is the policy of recomendations on this site? Probably have to declare your interest and why you recomend them?

By the way because of all this messing I have hade to make an incomplete return for the period in question.  Rev insist on paper filing for large rebates-and I dont have the paper!

This is a real head wrecker for me, that said it beats the lengthy thread about house prices falling...


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## Luternau (16 Oct 2006)

extopiaThis thread is too bizarre. Sounds like the VAT reclaim idea may have been an afterthought?

Not at all, I told the seller from the outset that I was registered for VAT , and would be seeking to capitalise them. I explained the process and said that I would require an invoice for the full amount paid in my name.
Obviously they did not fully understand or probably more to the point they were jsut trying to off load the properties to aviod closing on them themselves...
Perhaps in such cases its seller beware...if they did not understand the implications of what they are at, then perhaps they would be better off not getting involved in massive speculation-as that is what it is. We are talking about the total conveyance of property totalling about 9 million Euro to a multitude of buyers-some of whom may not even be aware that there may be a future liabiity to unpaid VAT-assuming that what SPC100  said at 2.40 pm today;
"They might think this clause limits there liability in the future . i.e. if they get investigated, and get told they should have charged VAT, they will add the VAT on to your bill and say it is now due and bill it to you"


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## extopia (16 Oct 2006)

I'd say it's buyer beware, as it looks like in this case you will have difficulty reclaiming the VAT, so if that was a factor in your purchase you're out a significant amount?

It seems to me that if there's any liability in this case for unpaid VAT it won't be on you - it'll be on the people who collected VAT. As you did not receive a VAT invoice (and the "flipper" does not appear to be VAT registered), you did not pay any VAT so you have no liability to the VAT office, nor a case for a refund.


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## liteweight (16 Oct 2006)

Of course he paid vat, it's included in the price of the sale on a new build. A FTB pays vat on a new build but normally has no way of reclaiming it. The builder then pays this on to Rev.

Luternau, do you have more than one property. As far as I know, you will have to charge vat on the rental even though you couldn't reclaim. Waiving exemption means that all properties owned by you are liable for vat.

In your case, the builder is going to repay vat on the property to Rev. If his books were examined, who would he say paid him the vat....the flipper or you??


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## extopia (16 Oct 2006)

liteweight said:


> Of course he paid vat



As I understand this thread, if his deal was with the "flipper" and the flipper is not VAT registered, he did not pay VAT as such as the seller cannot charge VAT, he just paid the VAT-inclusive-equivalent amount (plus whatever extra he paid).


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## Luternau (16 Oct 2006)

I have more than one property, have waived my exemption, and now return 21% of all my rental income bi monthly. Its the most tax efficient way for me as my LTV is quite low and I dont want to gear up by buying more to make the rental income more tax efficient.
Only the mark up was paid directly to the flipper. The rest was paid to the developer. The contract was clear that the flipper was to be paid his mark up on the same day the conveyance took place. In essence I took over the flippers responibilities to the developer. That is what i signed up to.
Such is the nature of these deals that they remain invisible to the revenue-the flipper just dissapears, and in some cases can even dissapear without even declaring the gain. Perhaps its just me, but does anybody else think that this flipping (in this case -selling on before completion) is not just as clear cut as the flipper would like to think.
Revs comments to me-the property is still regarded as new, even when flipped to me in this manner, and VAT is due on a flippers markup. Thats their interpretation...and i would like to think that the experts know tax laws.


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## Luternau (16 Oct 2006)

Re SPC100
You are correct in the 1st 2 points-the 3rd appears to be the case too-according to Revenue, that is.
The contract make no mention of a VAT invoice. It was agreed that i would get an invoice. In anycase , standard building contracts make no metion of VAT invoices.


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## Luternau (16 Oct 2006)

Yes, that would be ok for me. Its only a difference of 90k or 11k of a rebate. Developer insists they can only issue this to the Original contracted Purchaser. 
At this stage i think i need to force it -legally. Developer may be protecting the flippers here-ie they could perhaps be a link-a contractor getting some apts cheap off plan as part payment for works done on site,or at another site. CGT is better than income tax on trading income. 
This arrangement suits everyone from the banks financing the project (they see names on contracts) to the contractor who can sell minus the EA's commission and the contractor who gets more this way. Call it a house of cards where each card, top or bottom is relying on all the other cards for their stability.


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## HME (16 Oct 2006)

Flipper is obliged to be registered for VAT as he/she is dealing in property.  As you are registered for VAT flipper is obliged to provide you with a VAT invoice.


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## Luternau (16 Oct 2006)

Thank you for that HME-you seem pretty sure about that. I also believe the flipper is not just doing this as a private individual, but as a quasi property developer. VAT and income tax issues piling up for the future if audited as to their new found riches!


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## liteweight (17 Oct 2006)

extopia said:


> As I understand this thread, if his deal was with the "flipper" and the flipper is not VAT registered, he did not pay VAT as such as the seller cannot charge VAT, he just paid the VAT-inclusive-equivalent amount (plus whatever extra he paid).



The way I understand it is that the deal is like a three way system. All parties must be represented on the day. The flipper is paid his share and the builder is paid the rest. The former is paid his deposit plus profit but the builder gets the lions share. The property is still considered to be a new build for stamp duty purposes if the purchaser is an owner/occupier. Therefore, it follows that it is still a new build for the investor. 

The way it stands at the moment is that the builder has Luthernau's money but is saying he never sold the property to him........he sold it to the flipper!! I understand what you mean by the comments above and that would hold true if not for the split between flipper and builder. Am I missing something?


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## liteweight (17 Oct 2006)

HME said:


> Flipper is obliged to be registered for VAT as he/she is dealing in property.  As you are registered for VAT flipper is obliged to provide you with a VAT invoice.



Just because Luternau is registered for Vat, it doesn't follow that everyone who sells anything to him has to be registered too. It just means that Luternau has to charge VAT when he sells.

Why is the flipper obliged to be registered? I don't know whether he is obliged or not but investors sell property all the time and there is no obligation to be registered. How does Rev. distinguish between, someone who is making a business out of it, and someone who just can't afford to continue with sale, and who has been given an 'out' by the builder?


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## liteweight (17 Oct 2006)

Luternau said:


> Yes, that would be ok for me. Its only a difference of 90k or 11k of a rebate. Developer insists they can only issue this to the Original contracted Purchaser.
> At this stage i think i need to force it -legally. Developer may be protecting the flippers here-ie they could perhaps be a link-a contractor getting some apts cheap off plan as part payment for works done on site,or at another site. CGT is better than income tax on trading income.
> This arrangement suits everyone from the banks financing the project (they see names on contracts) to the contractor who can sell minus the EA's commission and the contractor who gets more this way. Call it a house of cards where each card, top or bottom is relying on all the other cards for their stability.



When talking to a contractor recently he told me that a number of people working on site, i.e. employed full time by the builder, put down a holding deposit on apartments they think will sell well. The developer doesn't necessarily know that his workers are flipping but they (the workers) have inside knowledge of when the first phase is going to be released. I don't know if he was spoofing or what but he was adamant that the practice is widespread. If I'd read your post before I spoke to him, I would have asked how the VAT situation is handled!


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## extopia (17 Oct 2006)

Luternau said:


> I have more than one property, have waived my exemption, and now return 21% of all my rental income bi monthly.



I hope you mean 17.35% of your gross amount, or else you're paying too much.


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## asdfg (17 Oct 2006)

> Such is the nature of these deals that they remain invisible to the revenue-the flipper just dissapears, and in some cases can even dissapear without even declaring the gain


Who pays this gain? Someone has to. If the flipper disappears are you therefore buying the property at the original price and will you have to pay CGT when you sell on the full gain including the flippers gain. 
I realise it is not your responsibility to follow up on the flippers tax affairs.


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## Luternau (17 Oct 2006)

liteweight said:


> Why is the flipper obliged to be registered? I don't know whether he is obliged or not but investors sell property all the time and there is no obligation to be registered.
> 
> The obligation may fall under the value of the transactions-there is a limit of trade under which you do not need to be registered. If the property is second hand there is no VAt issue.
> 
> ...


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## Luternau (17 Oct 2006)

extopia said:


> I hope you mean 17.35% of your gross amount, or else you're paying too much.


 
Yes



asdfg said:


> Who pays this gain? Someone has to. If the flipper disappears are you therefore buying the property at the original price and will you have to pay CGT when you sell on the full gain including the flippers gain.


 
I am only liable for any gain that I ahve made over and above what I paid,  -so with evidence (contracts), that I paid a premium on the original SP, this should suffice for my tax affairs. 

My solicitor tells me that there is no way for the Revenue to follow 'Flipping deals' as the flippers name does not appear on the lease. So unless the gain is declared they know nothing. All seems a bit lax-but as we all know, if Revenue were collecting all the taxes that they should be they could afford to know 4-5% of income tax and still come out on top. This was a figure that mentioned some time early this year when referring to the tax lost to the exchequer form the black economy alone.


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## liteweight (17 Oct 2006)

If your solicitor is correct and the Revenue can't follow flipping deals, how will they oblige them to pay VAT unless the flipper can be traced through capital gains tax? It's self assessed but I think most would choose this (20%) over income tax (42%). In fact, from reading this subject so far, I know they opt for capital gains. A lot of flippers only do it once but I'm sure a few have made a business out of it.


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## asdfg (17 Oct 2006)

> My solicitor tells me that there is no way for the Revenue to follow 'Flipping deals' as the flippers name does not appear on the lease


Surely the flippers name appears on the VAT invoice from the builder so it can be traced if revenue are aware of the facts.


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## Luternau (17 Oct 2006)

Revenue can follow the paper trail of an invoice, but remember, not everyone asks for one-as I have, and more importantly, if a developer was accomadating to flippers, a VAT invoice could be issued to the the actual purchaser.  Thereby leaving little or no trail of the first transaction. 

Its easy to see how some people can make a living out of this-Tax free income ! Personally I would decalre at 20% (CGT) , but as its self assessed, its probable that you could get away with 100% if your name featured no-where.

In this case , I feel that I am within my rights to seek and recieve and invoice in my name, for the full asking price. If that leaves the fliper in a tax muddle with the revenue-that is their problem. When it comes to Flipping, its seller beware!


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## liteweight (17 Oct 2006)

asdfg said:


> Surely the flippers name appears on the VAT invoice from the builder so it can be traced if revenue are aware of the facts.



When we bought our name did not appear on the VAT invoice. We requested a copy with our name. Copy arrived but again no name. We asked again with the same result. Our solicitor said it was of no consequence as the invoice was included in the contract sent by their solicitor and should suffice for Revenue purposes. It did suffice but Revenue asked for full contract just to confirm we were the owners. In Luternau's case he can't get the invoice from anyone.


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## extopia (17 Oct 2006)

There's far too much speculation going on here about what the Revenue might or might not accept or think about this, that, and the other.

If the VAT refund was part of the business plan, you need to be speaking to an accountant who knows the tax law and knows his or her way around these issues. You're getting nowhere here, and speculating about the flipper's tax compliance doesn't solve your problem .


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## Luternau (17 Oct 2006)

extopia said:


> There's far too much speculation going on here about what the Revenue might or might not accept or think about this, that, and the other.
> 
> If the VAT refund was part of the business plan, you need to be speaking to an accountant who knows the tax law and knows his or her way around these issues. You're getting nowhere here, and speculating about the flipper's tax compliance doesn't solve your problem .


 
The reason for the post in the first place was to get some opinions. As can be seen, there are many,differing opinions-and yes some speculation. Call it a open debate-and that is what this whole site is about.

Part of the problem is that i am getting differing opinions from people that i thought I would know-the revenue, Accountants, solicitors, etc. As to the tax compliance or otherwise of the flipper, i feel justified to wonder about this, as it is this party that is blocking me from sorting out my tax affairs. Perhaps Extopia, you can PM me and recomend someone that help me make some progress?


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## Luternau (7 Feb 2007)

Update-from last post in this thread-Oct 06
After much hassling for invoices I finally got the builder to agree that I was the actual Purchaser of the Property, and duly got invoices, in my name-but only for the builders contract price. The VAT refund was lodged to my account in no time. 

Revenue were delighed with the information that I provided them with- and have launched an investigation. They confirmed that the threshold for VAT on property sale is nil.  If they find that the flipper went out of his way to create schemes to avoid tax-this guy may face VAT and income tax liabilities plus interst and penalties circa 200k!!  Unfortunately, unless he makes a voluntary disclosure I will never know if they were done and for how much! There is no fun in that!!!


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## Skyscout (27 Mar 2007)

Hi Luternau,

I am now in exactly the same situation. How did you go about getting the invoice off the builders?. Did your solicitor help you or did you have to hassle them yourself?


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## Luternau (27 Mar 2007)

Welcome to AAM
Your solicitor should help you. I got it from the builder after a bit of correspondence-really it gets down to what is in the contract you have with the original purchaser. It appears form your post that you are having difficulties?


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## Skyscout (28 Mar 2007)

Thanks!.

I have two RIP's and waived exemption, reclaimed VAT as input credit etc.... New Prop (no. 3) bought through a flipper and want to do same. Filed return and now revenue want a receipt!. Having difficulty in obtaining receipt for this one. My solicitor was dealing exclusively with assignor's solicitor not the builder's solicitor. 

He is chasing it up for me this morning and I should know more. But it appears at best case I will only get a receipt for the amount the builder charged the flipper and not the entire amount of purchase price (which I put in tax return and am sure I am entitled to). Flipper isn't VAT registered and I'm not sure if he is even resident in Ireland to complicate matters. 

Would you recommend enlisting the help of someone like Loweq or other tax advisor who specialises in these areas - I feel a little out of my depth.  

Skyscout


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## Luternau (28 Mar 2007)

I dont think you need loweq for this-they will bring no vlaue to the process-and charge a fortune for it. Do it your self.
I too only got a receipt for the amount the builder charged to the flipper. The rest-which as you say, make the full purchase price, has not been receipted to me and may take a while to get.
Anyway Revenue wont give you a refund on the full price paid unless the extra amount of VAT has been receipted by them. The residency of the flipper is irrelevant here as the goods have not been exported.  There is no such thing as a duty free exemption on property sales. 
Best thing is to get receipt in your name from the builder, make VAT return and supply cover letter stating you paid more and cannot get a receipt. Give details of the flipper and ask them (through your solicitor) to investigate VAT avoidance. See other post on 'selling on Contract'


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## alfabeta (29 Mar 2007)

Very interesting thread, just had a thought regarding the stamp duty, were you charged stamp duty on the total price net of 13.5% VAT or the original price net of 13.5% plus the gross amount paid to the sub-seller.


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## Luternau (29 Mar 2007)

I have just paid stamp on the lower price, however I am prepared to pay on the higher price-and have declared the higher price for stamp purposes. Its still with the Revenue to decide how it transpires from here.


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## Skyscout (3 Apr 2007)

Ditto, I paid the solicitor for the stamp duty at the higher rate (6% on the total amount) But when you take the VAT element out in my case the price I paid falls below the threshold and into the 5% band. So basically a €6k difference in SD. My solicitor is going to go in at the lower amount but has the funds available if Revenue quibble it. The vendors solicitors are in agreement that I should get a VAT invoice from the builder and they are on it, so it's just a question of when not if.....phew!


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## Luternau (3 Apr 2007)

Have your vendors any idea on the VAT and CGT/income tax situation they may face? What about the invoice for the additional amount? Will they give you one? Are they VAT registered?


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## Skyscout (4 Apr 2007)

I'd be happy with just the builder's invoice, the vendor sold to me at a price substantially below market value so I'd rather not push it. As far as I know the vendor is not VAT registered.


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## PrivateI (9 Apr 2007)

1. I am purchasing a newly constructed investment property with my fiance. We both own PPRs at the moment. If we register for VAT and reclaim the VAT on this investment property will we have to pay VAT on any rental income we recieve in future or just on rent from the property which the VAT was reclaimed? 

2. The builder has agreed to structure the contract to minimise the stamp duty. There is the option of including a conservatory which is not in the "main" contract. This will be executed as an extra to the main contract.

Main Contract Purchase price divided as follows: 
Site purchase: 200000 SD @ 9%
Construction Contract: 480000 SD @ 7.5%

Conservatory Contract: 80000 SD @ 0%

Am I correct in saying that VAT can be reclaimed on the construction contract and the conservatory contract @ 13.5%?

3. We are also in the process of building a new house which we plan to live in and nominate as our PPR in which case the other two PPRs will then be considered investment properties aswell. Will any rent recieved from these once they are investment properties be VATable? Complicated I know but perhaps someone has heard of a similar situation?

4. Any advice or pitfalls would be appreciated.


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## Arch2 (10 Apr 2007)

Biggest pitfall is you are too late.  You can no longer reclaim VAT on residential property as of passing of the Finance ACT.


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## deem (10 Apr 2007)

YOu are too late only if property is residential, if a commercial property it is still ok to do this.


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