Hi WizardDr.
" the garbage that Revenue is pointing out was in the detail already"
It wasn't; not really. actually not at all. Revenue are actually now saying that they are going to assume that someone who part funds (or simply co-signs) the mortgage on a property is a part owner of it. Even where someone part funds a mortgage but says openly that they do not have an ownership interest of any sort, Revenue say
"we won't take your word for it - we will only believe you if (among other things) you can show that the lender asked for you to be on the mortgage".
To take this to its logical conclusion, imagine the following scenario:
1. Father co-signs mortgage, without being asked by the bank to do so.
2. Father signs acknowledgement that he has NO interest in the property
3. Father falls out with daughter and seeks to claim share of property.
In this scenario, the father would be laughed out of court. But that is not good enough for the Revenue. As far as they are concerned, for Stamp Duty purposes, he is still a part owner. This is wild stuff.
The presumption in law that someone has an ownership share, even if they are not the registered owner, arises out of a legal construct known as a resulting trust. It is a complicated area of law, but where a presumption of a resulting trust arises, the presumption can be rebutted by the apparent beneficiary simply confirming that he\she does not have an interest. Everywhere except in Dublin Castle.
The entertainment doesn't end with the FTB relief. There are a load of other reliefs out there waiting to be re-interpreted. Here are a few:
1. Ordinarily, if a farmer\businessman over 55 gifts or sells his farm\business to his child, there is no CGT because of Retirement Relief. What happens if the child is buying out the parent and gets a mortgage in joint names with child's spouse? If Revenue apply the EXACT SAME LOGIC to this scenario, then retirement relief on a disposal to a child must now be refused.
2. There is an exemption from Gift Tax, Stamp Duty and Capital Gains Tax on a gift of a site to a child. If the child is getting a mortgage in joint names with spouse, then even if the site is in child's sole name, presumably all these reliefs must now be withdrawn. That is the inevitable consequence of applying the exact same logic.
3. There is a Gift Tax relief on a transfer of a house to somebody who has been living in it for x number of years, provided they own no other house, continue to live in it etc. But if that person gets a mortgage to fund the transaction (and perhaps some improvements) and has to borrow in joint names with a new spouse, who hasn't lived in the house long enough to get the Gift Tax relief, then the relief must be taken away. Who cares if the spouse isn't actually a transferee? Didn't he sign the mortgage? Isn't that enough for Revenue to decide who the owner is?
Make no mistake folks; some bright spark in Revenue has opened up a real Pandora's box here.