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So are we talknging about tax evasion or tax avoidence? 1 legal.
I would venture looking at a house which is on the market at X and then subtracting the value of shelves and wooden floors would be tax evasion, completely dodgy and result in the Revenue coming down like a ton of bricks.
What if a third party buys the bits and peices?
As far as I know Revenue would not allow you to deduct the value of the wooden flooring and tiling - only contents which the vendors wish to sell to you and which they could take away if you did not want to buy. The vendors are not going to rip out wooden flooring, tiling and bathroom fittings if you decided not to buy them - they come as an integral part of the house and are not contents. But try anyway and negotiate the best amount you can to deduct from the chargeable amount.
I mean, say I was buying a house from you for €380,000.
I see a really nice table in the house and offer you €2,000 for it which you accept. Surely there's no potential stamp duty issue here?
Ordinarily legal contracts would be written so that all the articles named by the OP would be included, not deliberately excluded. We all know of cases where people turn up at their new house only to find it stripped of all the fittings, including lightbulbs, because they didn't ensure this was in the contract.not included in the legal document
On the original question and judging by the Revenue literature, the OP is 100% correct, all the items listed can be viewed as a seperate transaction and so reduce their stamp duty bill.
All that's really being achieved here is extra work for the solicitor in drawing a seperate contract (and presumabily a higher bill).
This holds true as long as the OP calculates the SD band that applies as house and contents i.e. the OP cannot use this as an artificial construct to bring the house into a lower SD bracket. This will be illegal even if the revenue accepts the values indicated are fair.
On the original question and judging by the Revenue literature, the OP is 100% correct, all the items listed can be viewed as a seperate transaction and so reduce their stamp duty bill. Where I believe the OP is mistaken is in the values attached to the items. Whilst I'm sure each of these items did originally cost a fair amount of money and it's true that you can agree whatever fee you wish when creating a private transaction, Revenue will more than likely view this as an artificial transaction created solely to reduce a tax liability. Which it obvously is. What would be the market value of a 2nd hand carpet cut to the dimensions of a particular house? Tiles chiselled off a wall? Any electrical equipment? Check out FreeCycle.com or DublinWaste.ie to find out.
The key part of the Revenue literature is
Ordinarily legal contracts would be written so that all the articles named by the OP would be included, not deliberately excluded. We all know of cases where people turn up at their new house only to find it stripped of all the fittings, including lightbulbs, because they didn't ensure this was in the contract.
All that's really being achieved here is extra work for the solicitor in drawing a seperate contract (and presumabily a higher bill). I would imagine this is a scenario that has been suggested by the vendor or agent in order to entice the buyer, make them feel like their getting a bargain. If you want to have 1K more in your pocket offer 1K less on the asking price.
In the long run you may not be saving yourself anything. If at some point in the future this prperty became an investment property and so liable for CGT on it's eventual sale you would have to calculate your taxable profit on the lower amount you're paying. As a result you'd face a 20% CGT bill on the amount you'd paid for the contents. So save 3% short term, pay 20% long term.
I'm just about to buy a house with a certain amount of contents. The solicitor wants the EA to write out the inventory with a value to submit to the revenue so I won'r have to pay stamp duty on it. The EA says the value is only small, but by my estimation it is sizeable, totalling to circa 15k (below). Does my estimate look reaslitic? (This is all quality stuff, the place is finished to the last word)
Fridge/ freezer; €500
Built in dishwasher; €400
Oven + hob; €900
Table and 6 chairs; €600
Double bed; €400
Bathroom fittings in en suite; €300
Bathroom fittings in main bathroom; €300
Bathroom fittings in downstairs toilet; €200
Garden shed; €1200
Additional partition fencing in back garden (dog's area); €400
Blinds / curtains to fit 8 # windows / patio doors; €2,500
Shelving; €300
External decking; €2,500
Brass finish light switches / dimmers; €600
Flush mounted lights / special light fittings; €800
Wooden flooring / tiling in kitchen + bathrooms / carpets; €4,500
OP - I know one case in Ireland where the sellers took the sockets off the walls and all the bathroom fittings.
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