Stamp duty question

[Lin03]

Despite reading all the posts on stamp duty, I’m still confused!



Some years ago I bought a new house with a floor area of less than 125 sq. m. for which I paid 141,000 euro.

I am now planning on buying a second house which is new and has a floor area less than 125 sq. m.

I understand that I'm not liable for stamp duty for the second house because it’s new and under 125 sq. m.

I assumed that I would owe stamp duty at the investor rate for the first property, something in the region of 3%.

Or am I exempt from that also because the floor area of less than 125 sq. m??



Thanks in advance.

 

[ClubMan]

I understand that I'm not liable for stamp duty for the second house because it’s new and under 125 sq. m.

Yes - assuming that you are buying this property as your home (PPR). Otherwise investor stamp duty applies.

I assumed that I would owe stamp duty at the investor rate for the first property, something in the region of 3%.

Depends on what you're doing with the first house. If you are moving out of it into the new house but retaining the first one and renting it out within five years of purchase as an owner occupier then a clawback of stamp duty (i.e. the amount that an investor would have paid) is due when you rent it out.

You need to clarify what you are doing with each property and which will be your PPR.

 

[Lin03]

The second house will be my PPR and I will rent out the first.
Was just hoping that I might be exempt from stamp duty on the first property because it was under 125 sq. m. but I guess that was wishful thinking on my part.

Thanks.

 

[ClubMan]

Was just hoping that I might be exempt from stamp duty on the first property because it was under 125 sq. m. but I guess that was wishful thinking on my part.

When did you buy the first house? If you rent it out within five years of purchase as an owner occupier then you are liable for a y. However if you rent it out after five years of ownership then you will not have to pay this. Since the new property is new and under 125 sqm will be your PPR you are exempt from SD on that.

No offence but I find it worrying/startling that prospective property investors such as yourself and many others who post on AAM are not au fait with pretty basic tax matters such as these (and maybe also the CGT and income tax implications) and don't seem to get independent, professional advice in order to avoid nasty surprises once they plunge into the residential property business.

 

[Lin03]

I understand the clawback issue and know that I will have to pay CGT if I sell the investment property.

My confusion was regarding stamp duty and the floor area.

According to -
'People who rent out new or second-hand houses or apartments are considered 'investors'. The same rates of stamp duty apply to investors as to non-first time owner-occupiers'.

I am now a non-first time owner occupier and I don't have to pay stamp duty on my new house (my PPR) because it's less than 125 sq. m.

If as stated above, stamp duty rates are the same for an investor as a non-first time owner-occupiers then doesn't that imply that there's no stamp duty for an investor with a property that has a floor area less than 125 sq. m.??

 

[ClubMan]

If as stated above, stamp duty rates are the same for an investor as a non-first time owner-occupiers then doesn't that imply that there's no stamp duty for an investor with a property that has a floor area less than 125 sq. m.??

It does seem to imply this but this is wrong. Perhaps the line should read thus in order to be more accurate:

People who rent out new or second-hand houses or apartments are considered 'investors'. The same rates of stamp duty apply to investors as to non-first time owner-occupiers of second hand properties.