Asked for part cash payment for commercial property - how much?

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wigwammer

Registered User
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Hi,
I hope this is in the correct forum.
I'd appreciate some advice/guidance, as I don't really have any mentor that can guide me, and feel a little at sea with the estate agent.
I'm currently negotiating to purchase a commercial property. We've arrived almost at a price but the vendor has asked for a price with part payment of cash, no specific amount.
I'm just wondering if there's a percentage cash that's acceptable/the norm. I'm sure he wants as much as possible, but I want to try to get a reduction in price if I offer some cash. Was thinking 5% or am I completely off the mark?

Also are there any implications for me, tax wise, if part paying cash? I will be declaring the full amount, of course.

Many thanks.
 
Presumably the seller is proposing that if you agree to buy the property for €100,000, the contract will say €90k and you will pay €10k cash.

This is fraud and you should have no part of it.

You are defrauding stamp duty.
He is probably defrauding the Revenue for CGT
He may also be defrauding his creditors.

When you go to sell, your gain for CGT purposes will be higher (Not a big issue if you buy this year, as the first 7 years will be CGT exempt)

Of course, you could exchange contracts for €90k and then refuse to pay the €10k, as such a side agreement could not be put in writing. However, he might insist that the €10k be paid up front, in which case he could deny ever having received it and refuse to sign the contract.

I am amazed that the estate agent is acting as messenger boy on this.
 
Thanks Brendan,
Don't plan on defrauding on stamp! I would expect the contract to state the full amount. I want all to be above board as far as I am concerned.

So maybe that's his plan, and in that case the deal won't go ahead as I'm not paying the higher amount asked for and not agreeing to state 90k and pay 100k. Would there be any other reason for a deal to be done part cash - for cash flow?
I'll need to clarify with EA. He just said vendor will accept x price with some cash payment.

Thanks for feed back.
 
No other reason that makes sense. cash payment generally implies unreported/undocumented funds and as per previous posts you should refuse to comply with this. It is of no benefit to you the purchaser and also carries a number of downside risks for you. I thought this sort of thing had gone long ago!!!
 
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