First Time Buyer Stamp Duty query

I am currently in the process of buying my first house in Dublin and am currently entitled to exemption from stamp duty, as a first time buyer. However it is likely that I am going to have to temporarily move to another part of the country for six months from some time later in the year in which case I am going to need to rent out the property during that period (hopefully to a friend or someone I know, which would make things easier).

I am wondering if anyone could tell me whether renting out my first home so soon after purchasing it may cause problems in terms of my stamp duty free entitlements considering I should be living in it for the first five years after purchasing it? I have been looking into the rent a room scheme and I think it may be possible to legitimately get someone into the house renting under that scheme during the period in question as it is unlikely that the rent would exceed the €10k annual tax free threshold during that period. It would after all still be considered my primary residence, even whilst I am away.

Any further thoughts on this would be much appreciated.

MPG2008 said:

I am wondering if anyone could tell me whether renting out my first home so soon after purchasing it may cause problems in terms of my stamp duty free entitlements considering I should be living in it for the first five years after purchasing it?

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If you rent your property out other than under the owner occupier rent a room scheme within two years of purchase then you will be subject to a clawback of SD. In this case you would be liable for whatever an investor would have paid on the purchase.

I have been looking into the rent a room scheme and I think it may be possible to legitimately get someone into the house renting under that scheme during the period in question as it is unlikely that the rent would exceed the €10k annual tax free threshold during that period. It would after all still be considered my primary residence, even whilst I am away.

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Depends on the specifics of your situation. Would you be choosing to work elsewhere or would you be seconded and required to go?

You may need professional advice.

If the renting comes within the rent a room scheme and the move is only temporary then you shouldn't have a problem but if you rent the whole property out there will be a stamp duty claw back and tax to pay on the rent.

Given that you know that you'll be moving away for a period so soon after buying the question arises, why buy now?

It just seems life would be so much easier if you just bought when it was appropriate.

MPG2008 said:

... I should be living in it for the first five years after purchasing it?

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The five year rule for clawback has now been changed to two years.

It would after all still be considered my primary residence, even whilst I am away.

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Are you sure?
It all depends on the specifics as mentioned above. If you are seconded with work, then possibly it will stay as your PPR, but in such a case I'd seek professional advice to be sure.