Stamp Duty+First Time buyer = Confusion

[avon]

Hello all,

I wonder if any one can give me a definitive answer to this problem. A friend bought an apartment as a first time buyer and decided to rent it straight away. Initially he did not pay stamp duty as he was exempt as a first time buyer.

However, as he rented straight away (bills were put in tenants names and they use a rent allowance) does he have to pay the exemption back? If so will he be able to buy again as a first time buyer and When would revenue generally contact him about htis as he has not received any letters to reclaim the stamp duty in the 2 years that he has owned the property?

All advice appreciated.

 

[Howitzer]

However, as he rented straight away (bills were put in tenants names and they use a rent allowance) does he have to pay the exemption back?

Yes

If so will he be able to buy again as a first time buyer.

No

When would revenue generally contact him about htis as he has not received any letters to reclaim the stamp duty in the 2 years that he has owned the property?

They won't, it's self assesment.

However they will contact eventually if he doesn't file a return, including interest on his original debt. This isn't a vague warning like the boogie man under the bed that your parents warn you about, the Revenue simply take their time with issues like this. At the end of the day it doesn't matter one iota when they catch your friend as the longer they leave it the more interest and fines become applicable, and the most cast iron their case becomes. FYI, any judgement over 12K brought by the Revenue is published on an annual basis in the daily rags.

That is as definative an answer as you'll get as it's very clear cut, there aren't many buts and maybes.

 

[liteweight]

I second what Howitzer has said.

 

[avon]

Howitzer,

Thank you very much for this answer. I will break the bad news later today!

Thanks again for your help.

 

[mf1]

A friend bought an apartment as a first time buyer and decided to rent it straight away. Initially he did not pay stamp duty as he was exempt as a first time buyer.


Am I the only one who cannot see the logic in this? I'm a ftb but do not intend to be an owner occupier, I'm pretty certain that in that scenario I'm going to have to pay stamp duty because I am an investor, but I'll be a ftb anyway because I am exempt.

Can I be a ftb next time around????????

It beggars belief and it is not rocket science.

mf

 

[robd]

Am I the only one who cannot see the logic in this? I'm a ftb but do not intend to be an owner occupier, I'm pretty certain that in that scenario I'm going to have to pay stamp duty because I am an investor, but I'll be a ftb anyway because I am exempt.

FTB relates to purchase of a PPR only, not an investment property. FTB status is a relief designed to help buyers purchase their first house to live in.

Can I be a ftb next time around????????

Afraid not. Once you own any property you are no longer a FTB. This is fare.

It beggars belief and it is not rocket science.

I don't agree with you there. If you're buying an investment property you're doing it to make money. Thus why after you've theorectically achieved a Capital Gain (big assumption of Capital Appreciation) in an Investment Property would you be entitled to relief to go and buy a 2nd property (even though it's to live in)? You've made your money.

 

[mf1]

Actually, I was being sarcastic - if you read the earlier posts on this thread, you'll see what I meant.

mf

 

[BOF]

Is there a URL for working out what the penalties are and at what point they start from (i.e. is it the transfer of the property or the commencement of the renting?). I have a property that was initially bought to be occupied by me, but when planning permission failed I turned it into a rental income 18 months later. I've only just found out I'm liable for SD. Bugger.

 

[liteweight]

Actually, I was being sarcastic - if you read the earlier posts on this thread, you'll see what I meant.

mf

Well the reply to your post this morning gave me a good laugh! What was it you said...it beggars belief!!