Stamp Duty Clawback.

After years struggling, i just thought life had taken a turn for the better , now i find myself in this terrible situation.
Myself and my family(wife+2kids) moved from an appartment in Dublin which i owned for 3 years,to the country since the beginning of september last (for school).We decided to get renters instead of selling, for the appartment in Dublin for the minute and regestered them with the PRTB . We subsequently used that money to rent a house in the country which is regestered with THE PRTB. I genuinely never heard a word about the Stamp Duty clawback until the budget.Could someone please advise wheather i have to pay stamp duty clawback as i heard if you rent it ,you get caught.Thanks.
P.S.I havnt told my wife yet as she was delighted we moved and just settling in, she would worry silly. It could be up to 10,000euro and my wife dosnt work.

As far as i know you dont have to pay that now as the clawback is down to two years.

When did you rent the property out? I presume that the 2 year SD clawback rule only applies post Budget 2008 and not retrospectively? The previous clawback period was 5 years and this may be the one that applies in your case. Maybe the Revenue or Department of Finance budget summaries clarify?

As Clubman mentioned the clawback rule does not apply retrospectively, therefore you are more than likely liable to a stamp duty clawback. From the information you provided it would seem that there is a 40% clawback. Depending on the likelihood of getting caught you might decide to take the risk and not declare this to Revenue. Have you registered for income tax yet? What you could do if not declare the clawback to Revenue, in the event of a tax audit make a 10% disclosing payment and this will reduce of fines greatly.

Schumacher said:

From the information you provided it would seem that there is a 40% clawback.

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What do you mean? The clawback is all or nothing and not pro-rata depending on how far into the 5 (now 2) year period you rent the property out.

Depending on the likelihood of getting caught you might decide to take the risk and not declare this to Revenue.

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You are legally obliged to self declare such tax liabilities. Few people here would recommend or condone tax evasion. Certainly not a prudent course of action.

Have you registered for income tax yet? What you could do if not declare the clawback to Revenue, in the event of a tax audit make a 10% disclosing payment and this will reduce of fines greatly.

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As above.

Thanks for yer replies and wouldnt like to evade tax either. But Its not like i moved for monetry gain. Also I told an accountant i discovered this clawback thanks to this website , they hadnt heard of it until they checked it out and said their are thousands in simular positions and not to worry about it too much. Also the solicitor i origionally had to buy the appartment didnt advise me after charging over 3000euro for conveyancing. Do i not have an argument even to get a discount. Or if i moved back? Thanks

timoney said:

Thanks for yer replies and wouldnt like to evade tax either. But Its not like i moved for monetry gain.

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Why you moved is irrelevant. You are an investor now so are subject to the relevant tax implications.

Also I told an accountant i discovered this clawback thanks to this website , they hadnt heard of it until they checked it out

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I find it difficult to believe that (m)any solicitors would be unaware of the SD clawback...

and said their are thousands in simular positions and not to worry about it too much.

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... or that they would say this.

Sorry - but this sounds like a wind up to me. If it's not then get another solicitor who is reputable and knows his/her job.

Hi timoney, are you looking to sell the apt within the next 2 years?

The stamp duty clawback only applies (assuming it was rented for a period) if you sell within the time-frame set out under the clawback scheme. As you owned and lived in the apt for 3 years before renting it out it would take another 2 years before the clawback date expires for your particualar apartment, i.e. if you continue renting it out for the next 2 years and sell it then you will not be liable for stamp duty clawback as the 5-year clawback term will have passed.

ivuernis said:

The stamp duty clawback only applies (assuming it was rented for a period) if you sell within the time-frame set out under the clawback scheme.

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No it doesn't. It applies as soon as you rent out a former PPR within the SD clawback timeframe (which is most likely 5 years in this case and is now 2 years as of Budget 2008).

if you continue renting it out for the next 2 years and sell it then you will not be liable for stamp duty clawback as the 5-year clawback term will have passed.

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Totally incorrect advice!