First time buyer status or not?

Z

z101

Guest
If I have never owned a property and am thus classified as a first time buyer, what would be my status or entitlements if I married someone who does own a house??
Do I lose all tax entitlements by getting married??
 
Not being smart, but you only lose entitlements if you buy a house together.

For example if you buy together you will not have any entitlement to relief from stamp duty like you would if you bought alone (married or not).

I don't think you will lose any entitlement in regard to TRS on your mortgage due to individualisation. This means if you remortgaged to get a joint mortgage on your partners house you would still get some TRS relief but may be not as much as you could get if you were both first time buyers (depends if your partner is still in the first 7 years of her/his mortgage).
 
MentalNote said:
I don't think you will lose any entitlement in regard to TRS on your mortgage due to individualisation. This means if you remortgaged to get a joint mortgage on your partners house you would still get some TRS relief but may be not as much as you could get if you were both first time buyers (depends if your partner is still in the first 7 years of her/his mortgage).
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Are you sure about this MentalNote?
 
You will still be first time buyer for TRS but not for stamp duty. I was in the same position when me and husband bought a house.
 
Don 08,

our position is, that I had bought an investment property before we, my wife and I bought our main residence. I was advised at the time, last January that, as we 're married and taxed under joint assessment rules, could not avail of first time buyer status for my wife.

Would it be possible to amend the situation now, 11 month on?

Any advice would be appreciated!


Thanks,
 
cologneboy said:
Don 08,

our position is, that I had bought an investment property before we, my wife and I bought our main residence. I was advised at the time, last January that, as we 're married and taxed under joint assessment rules, could not avail of first time buyer status for my wife.

Would it be possible to amend the situation now, 11 month on?

Any advice would be appreciated!


Thanks,
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If your wife was not considered a FTB 11 months ago, how could she be considered one now, Its like virginity, you dont get it back, not matter how long you wait.
 
cologneboy said:
Don 08,

our position is, that I had bought an investment property before we, my wife and I bought our main residence. I was advised at the time, last January that, as we 're married and taxed under joint assessment rules, could not avail of first time buyer status for my wife.

Would it be possible to amend the situation now, 11 month on?

Any advice would be appreciated!


Thanks,
Click to expand...


For TRS purposes*only, your wife should be considered a first time buyer and should be entitled to 7 years relief at the preferential rate.
 
So let me see if i have this right - If I get married to someone who owns a house then we buy a house together, we will not be considered FTB for stamp duty purposes, but will be considered FTB's (Because I have FTB Status) for TRS pusposes ?? Correct??
 
Ceatharlach said:
So let me see if i have this right - If I get married to someone who owns a house then we buy a house together, we will not be considered FTB for stamp duty purposes, but will be considered FTB's (Because I have FTB Status) for TRS pusposes ?? Correct??
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TRS is an individual allowance, regardless of if you're married or not.*


So for example, if you bought a house with someone who has owned a house for five years, you would get the full seven years of FTB TRS relief, but because the other person has already owned a house for five years, they would only get the remaining two years of FTB TRS relief before reverting to the standard rate.
 
OK - but as a couple we would get FTB TRS for 7 years because ONE of us is a FTB ???
 
Then there seems to be conflicting opinions here on this.

How can an individual avail of their FTB status when they marry if they hold a joint mortgage with someone who is not ?? You seem to be suggesting that this is possible..

I find it hard to believe someone would lose benefits by marrying.
 
Ceatharlach said:
Then there seems to be conflicting opinions here on this.

How can an individual avail of their FTB status when they marry if they hold a joint mortgage with someone who is not ?? You seem to be suggesting that this is possible..

I find it hard to believe someone would lose benefits by marrying.
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If you buy a house in Ireland these days as a first time buyer, you get seven years of preferential TRS rates. These rates don't change if you buy another house in that seven year period. In fact, you can buy as many houses as you like in that period and still be a first time buyer for TRS purposes. This is distinct from Stamp Duty where you only qualify for first time buyers status for your first house purchase.

TRS is an individual allowance which is unaffected by a person's marital status. If there is* a joint mortgage on a property, then each party to the mortgage applies for TRS individually and Revenue determines which rate each party qualifies for.

So if you as an FTB buys a house with someone who isn't an FTB, then the purchase will be assesed for SD as if you were both non-FTB's. But for TRS, you as a FTB will qualify for the 7 years of preferential FTB rates, but the other party will not re-qualify for the FTB rates.
 
plant43 said:
for TRS, you as a FTB will qualify for the 7 years of preferential FTB rates, but the other party will not re-qualify for the FTB rates.
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I am not getting something here, if its a joint mortgage/jointly owned property how can one partner qualify for 7 years TRS and the other not
 
Ceatharlach said:
I am not getting something here, if its a joint mortgage/jointly owned property how can one partner qualify for 7 years TRS and the other not
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It's the way is. That's the best answer I have for that one :)


Revenue has decided to treat each party to the mortgage as seperate entities for TRS purposes. I am not sure of the reasoning behind this.
 
Ceatharlach said:
I am not getting something here, if its a joint mortgage/jointly owned property how can one partner qualify for 7 years TRS and the other not
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The TRS relief is per person - so if both of you were FTBs (within the 7-year FTB period) then you could each avail of 2,000 TRS relief (for 2008). If one of you isn't an FTB and one of you is, then the FTB gets 2,000 TRS relief (again, for 2008) and the other gets a lower TRS amount.

The question then becomes what proportion of the mortgage each of you pays in order to calculate what proportion of interest is attributable to each person. For simplicity, if your joint mortage consists of a repayment of 500 capital and 1,000 interest each month and you are each paying 50% of the mortgage, you (as an FTB) get relief on 6,000-worth of interest (500 X 12 months). That relates to a 1,200 per year TRS payment (20% of 6k) and, as it is under the 2k limit for the relief, you get the full 1,200. The other party to the mortgage, if s/he is not an FTB or has used up his/her 7-years FTB allowance, only gets the reduced allowance (600 for 2008)

See [broken link removed]site for information. The point is that, even though the mortgage may be a joint one, the Revenue will attribute a portion of its repayment to each of the two parties and apply the different levels of TRS to each portion as a result. I do not know on what basis Revenue calculates what portion of the mortgage repayments is attributable to which paty.

Sprite
 
Thanks Sprite for the example, I understand where he is coming from now. Thanks folks
 
I assume joint mortgage holders and married joint mortgage holders are no different.
 
Ceatharlach said:
I assume joint mortgage holders and married joint mortgage holders are no different.
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This is exactly my question. I thought married couples jointly assessed for tax purposes could not avail of individualised TRS on mortgage interest relief.

If it is possible, where do I go from here to get it rectified?



__________
cologneboy
 
Well that was the real point of my question. If been married somehow excludes you from tax relief, then for want of a better term would that not be unconstitutional?
Full circle!!
 
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