Never paid Stamp Duty on investment

I spoke to someone recently who bought a holiday home but it is not their PPR and their solicitor told them they didn't have to pay stamp duty as they would be living in it from time to time. As far as I am concerned they were wrongly advised.

We bought the property next door and we paid our SD which I expected to have to pay.

Are they likely to get a slap on the wrist for this or is it all down to teh solicitor?

Very wrongly advised I reckon, even if they do live in it from time to time. The only two possibilties i can think of is if they are first time buyers (which I expect they are not) and this will not be an investment property (which it is). The other possibilty is if the house is a new build and is under 125sq metres but again it would have to be their main residence for the next five years.

It is a new build and under 125sq m but will not be their main residence

New houses or apartments (whether under or over a floor area of 125 sq. m) which are purchased by investors are charged to duty on the entire price paid (exclusive of VAT) for the house or apartment.
http://www.revenue.ie/
Under Tax and Duty and then Stamp duty

They should have paid stamp duty and I would imagine if the are registering the property as tenants this could be picked up by the revenue if audited and they would have to pay the stamp duty and possibly a fine. Also it is the individuals responsibilty as far as I know so saying that their lawyer said it was not necessary may not wash.

WHAT STAMP DUTY DO I PAY ON BUYING AN INVESTMENT PROPERTY?

Up to €127k……….0%
€127k to €190.5k….3%
€190.5k to €254k.…4%
€254k to €317.5k….5%
€317.5k to €381k….6%
€381k to €635k……7.5%
€635k+…………….9%

Investors pay these rates whether the property is new or second hand.

tosullivan said:

Are they likely to get a slap on the wrist for this or is it all down to teh solicitor?

Click to expand...

As above it sounds like they almost certainly have an outstanding SD liability on which they could potentially face interest and penalties. They need to sort this out as soon as possible. They might also want to take up the issue of seemingly being misadvised with their solicitor.

jj1310 -- are the rates you quoted not changed to the new rates of 7% up to €1 million and 9 % after that with the first 125 k classed as nil for duty purposes ??

I would have thought that the relevant rate is the rate that applied at the time of purchase, not the new rates.

Sorry i I created confusion. I was working on the date of the original posting and the use of the term 'recently'. If an error on my part, I apologise.

they would have signed before the deadline for the new rates so will pay the 3%....

fortunately for us, we signed after the deadline and pay 7% of above the 125k which works out a saving of about 2.4k on our part