Stamp Duty Avoidance

schoey123

Hi All,

We put in an offer of 175k on a house the vendors want to sell for 180k.

They rejected 175k saying the will not go below 180k. Having considered this we are now happy to go to 180k as we love the house.

However I would like to avoid paying Stamp duty by completing on 175k and coming to some agreement on the remaining 5k.

Can anyone provide any advice on how I can legally get round this ?

david29dpo

£5000 for carpets and curtains etc is the only legal way, but is a bit much plus your solicitor will want to know. He has to cover HIS back.

Doozergirl

Was that your first offer?

If you are prepared to pay 180k - not too many will be then I would still offer them 178,250. It allows you to pay the stamp duty without losing out too much, plus it's very, very near to what they want that they would be a little crazy not to accept. They need to be aware that anyone is going to be loathe to spend the extra 5 and be hit with nearly another 2 in Stamp Duty.

I'd work with the agent on this one, ask them to convince the owner. Let them do some work. It's a myth that the EA works for the vendor - they just want a sale.


Unless you can find 5k worth of stuff that isn't tied down to buy from them then anything else is illegal - even paying for carpets and curtains is dubious when you're paying on the Stamp Duty Threshold - it may attract attention.

m_13

Unfortunately the Land Transaction Return Form will find you out! It's not been possible to put through reduced values for a property and increased prices for fixtures and fittings since it came in

Rather than buying somewhere for a price just over one of the thresholds and facing a large bill, it might seem like a good idea to agree a lower purchase price and a separate price for items such as the carpets and curtains.

However, since 2003 purchasers have been expected to fill in a Land Transaction Return form. This is a complicated six-page document of 70 questions, outlining in detail the nature of the transaction (click here for a sample copy). This is designed to weed out instances where a property price has been kept artificially low.

I'm sure they are looking specifically at properties around the thresholds as that is the most likely area for under reporting. As david29dpo says, you're solicitor will want to cover his or her back.

terryw

Doozergirl wrote: »

Was that your first offer?

If you are prepared to pay 180k - not too many will be then I would still offer them 178,250. It allows you to pay the stamp duty without losing out too much, plus it's very, very near to what they want that they would be a little crazy not to accept. They need to be aware that anyone is going to be loathe to spend the extra 5 and be hit with nearly another 2 in Stamp Duty.

I'd work with the agent on this one, ask them to convince the owner. Let them do some work. It's a myth that the EA works for the vendor - they just want a sale.


Unless you can find 5k worth of stuff that isn't tied down to buy from them then anything else is illegal - even paying for carpets and curtains is dubious when you're paying on the Stamp Duty Threshold - it may attract attention.

A crackin' post. Well done ...

Schoey...go with this one as it is superb advice.

terryw

Credit_Check_Services

£5000 for fixtures and fittings on top of £175000 is going to look too much, I very much doubt the a solicitor will accept this.

Another approach would be to effect the purchase for £175,000 and have a separate contract through another solicitor to pay the vendor £5000 for other non-house related items. ... but all this seems complex to save only £1,750 ... can you not get the vendor to split the difference? Surely they cannot be inundated with buyers in today's market?

david29dpo

Another approach would be to effect the purchase for £175,000 and have a separate contract through another solicitor to pay the vendor £5000 for other non-house related items. ...This would be illegal and no solicitor would entertain it.

jazzy2009

just say you'll pay the £180k but they'll have to cough for the stamp duty.

Credit_Check_Services

david29dpo wrote: »

Another approach would be to effect the purchase for £175,000 and have a separate contract through another solicitor to pay the vendor £5000 for other non-house related items. ...This would be illegal and no solicitor would entertain it.

Anything you do to avoid paying SDLT is illegal.

terryw

Credit_Check_Services wrote: »

Anything you do to avoid paying SDLT is illegal.

Nope

terryw

Regmir

If everyone is looking for tax avoidance, who is going to support (politically correct way of saying bail-out!!) the banks in the future!
Only in billions at the moment and if we carry on like this soon it might start appearing in trillions!(if there is any such figures in reality).