Stamp duty clawback on PPR?

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bamboozle

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Does the rule change in the recent budget concerning living in your PPR for 2 years prior to renting it out apply for a certain date or retrospectively?

A friend moved out of his PPR 6 months ago (he lived in it for 2.5 years), he has been renting it since, he bought a new property which he is claiming his Mortgage Int, Relief on, is he liable for a stamp duty claw back on the 1st property? Or does he avoid it under the recent budget change?

Many thanks.
 
It applied from c. November/December. For somebody who rented their former PPR out 6 months ago the old 5 year clawback period rule applies. Your friend is liable for the clawback.
 
No. The solicitor has done his/her job once the original conveyancing on the purchase of the PPR has finished. If the individual subsequently decides to convert the PPR to a rental investment property then the solicitor has no involvement unless the individual contacts them again for advice. The solicitor's involvement in the purchase of the second PPR is irrelevant. If the same solicitor was used then perhaps they might ask what the client had done with the first property but I don't think that they are obliged to or to unilaterally give out tax advice.
 
I also have a query. If someone bought a property for €1.6million and paid stamp duty of €144,000 in June 2006 and also was a first time buyer at this time is there any clawback of Stamp Duty due to recent budget changes in Stamp Duty for FTB
 
You mean if they rent the property out before June 2008? You'd need to look at what an investor would have paid on the purchase in 2006 and if that is greater than the €144K paid then the clawback amount is the difference.
 
No he bought the property as a principal private residence for €1.6million and paid stamp duty on same. He is not going to rent out this propertry. His collegues have told him that due to changes in the budget he is entitled to a a refund of some stamp duty due to budget changes in Stamp duty. I am trying to establish if this is in fact true. Thanks
 
Very confusing to tag an unrelated query (about retrospective SD refunds) onto an existing thread (about SD clawback on renting a former PPR) like that...

The changes to SD rates/bands only applied retrospectively c. early November 2007 as far as I know (i.e. about a month prior to the budget). I'm pretty certain that they don't apply retrospectively as far back as June 2006 so your friend is most likely not entitled to any refund.
 
Apologies however thank you for your help, so just to clarify IF this did close in Nov some refund of Stamp Duty would be refundable but if any earlier no refund would be due. Again thanks for your help
 
GaryD said:
Apologies however thank you for your help, so just to clarify IF this did close in Nov some refund of Stamp Duty would be refundable but if any earlier no refund would be due. Again thanks for your help
Click to expand...
That's my understanding. If the specific purchase to which you refer closed in November 2007 then I don't know the specifics of what, if any, SD refund might apply. But surely it's a moot point anyway?
 
I am in the same situation - I bought a house as owner occupier about 2.5 years ago but moved back home due to illness recently. I let the property but have not registered it as a rental property yet - planned on doing that this month. Will I be subject to the claw back clause.
 
When exactly did you buy the property and when did you first rent it out?

Have you stopped claiming owner occupier mortgage interest tax relief on the mortgage as you should once it ceases to be your PPR (Principal Private Residence)?
 
I bought in 2005 - and originally let on room only basis. Then I moved out in September 2007 and let it fully but did not give a formal lease on the property. I planned on legalising everything this month.
 
So you have an outstanding liability for a clawback of SD under the 5 year rule that pertained before the Budget 2008 changes. You need to get this and any other tax (e.g. rental income taxation, owner occupier mortgage interest relief issues if applicable) and general (e.g. PRTB registration etc.) sorted as a matter of urgency.

I am assuming that there is no exemption for the fact that you had to (?) move out due to illness.
 
What would be considered an exemption - it is possible that I fall into this category.
 
There may not even be any exemptions. I was just thinking out loud. Get professional advice if in doubt.
 
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