First Time Buyer status

Hello,

I am a first time buyer, who is just about to close on my first property. My plan had been to rent the house out for the next 2-3 years. As I may do some travelling either thru work or on my own.

I have planned to pay the 3% stamp duty, however I have recently heard that sould a first time buyer rent his/her house within the first 5 years, revenue will claw back an extra 3% to bring the stamp duty to the 6% investor rate.

Is this correct? If so are there any ways to avoid this?

apd said:

Hello,

I am a first time buyer, who is just about to close on my first property. My plan had been to rent the house out for the next 2-3 years. As I may do some travelling either thru work or on my own.

I have planned to pay the 3% stamp duty, however I have recently heard that sould a first time buyer rent his/her house within the first 5 years, revenue will claw back an extra 3% to bring the stamp duty to the 6% investor rate.

Is this correct? If so are there any ways to avoid this?

Click to expand...

If the first-time buyer rents the house within five years Revenue will claim back or 'clawback' the difference between the higher stamp duty rates and the duty actually paid. The only exception to this is the 'Rent a Room' scheme where part of the house is rented out. If the house is sold within five years there is no clawback.

some light reading to get you started :

Are there no exceptions? What if a person were required as part of their contract to be out of the country on long term assignments?


Do you know if the clawback is sought in a onne off payment or installments?

apd said:

Are there no exceptions?

Click to expand...

Not that I know of.. . Basically it may be your first house, but you are only an investor, its not your primary residence....

don't know about how its paid, anyone ?

Has to be paid in full within 6 months of first deriving rent from the property, though the form you need to complete suggests that interest will apply from day one so should be paid ASAP. Anyhow, if intending to rent it out from the outset you shouldn't be claiming the FTB relief in the first place and shouldn't be signing a deed of conveyance that includes a certificate stating that you won't derive rent. Unless you intend pursuing further tax evasion by not declaring your rental income I think you should work on the basis that Revenue know everything, will know that you purchased a house as a FTB and will twig that this relief should be clawed back when they see you earning rental income.