stamp duty division

B

bob

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I am looking at buying a house divided into two apartments in South Dublin. I will be buying with my partner (both are first time buyers) is it possible for my partner to buy one house and me buy the second even though it is selling on the market as the one property and the folio is not divided.

The reason for the house to be bought by two people would be to help avoid the high rate of stamp duty subjected on the property if it is bought as one house. Where as if the price of the property is divided in two and bought by two people we would not be subjected to stamp duty.

Does anyone know if this is possible?
 
Are you borrowing to buy? If so, what would be the attitude of the lending institution? What is the total price? What would be the price of each apartment if the vendor was willing to go this road? Could each of you manage the individual mortgages? Do you intend to keep it as two apartments? If sells as two apartment, won't you need to look at a conveyancing structure that imposes obligations on each property to support, maintain etc.,etc. This is quite an aggravation for the parties but unless you carry through on the premise that it is two apartments then won't the absence of this structure mean that the purchase of the two was an evasion ( rather than an avoidance) of tax payable?

Food for thought?

mf
 
No need to answer any of the previous questions, the stamp duty rate will be determined by the cost of the entire house, i.e. the 2 apartments, because the individual purchase of either apartment would be part of a larger transaction involving the entire house, i.e. the 2 apartments.
 
Not necessarily. If the sale of each is not dependent on the other and the purchasers are independent of each other, then it is not a series of connected transactions. What if the vendor was selling each individually?

mf
 
True, but that's not the case here, the purchasers are not independent of each other and I would expect the sale of one half to be dependent on the sale of the other half. I can't imagine the vendor being happy to split the property (if possible, I don't know) and sell just one half without being able to compel the purchasers to buy the other half. Whatever kind of technical argument you might be able to make about it not being part of a larger transaction, it goes against the spirit of the legislation and would also fall foul of the anti-avoidance provisions in S811 of the Taxes Consolidation Act. I don't think Revenue would see this particular transaction as not being part of a larger transaction and if I were a solicitor I wouldn't be too eager to endorse this structure.
 
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