Reducing stamp duty

mshevermoore

We are looking to buy a house valued at £270,000 which will mean that we will have to pay 2% stamp duty. I understand we may be able to reduce this by having a separate value for the house and another value for 'chattels' - carpets and curtains. Is this correct, and if so could we reduce the purchase value to £250,000 and purchase chattels at £20,000? Does anyone know if there is a limit on the value of chattels?

Thanks

calleyw

Umm think they had clamped down on this big time. And if you try it you may well find that your purchase is looked in to. As you are just over the threshold of stamp duty.

They might allow a few thousands but never £20K.


Yours


Calley

Ian_W

If the carpets, curtains or other furniture is genuinely worth £20K, no problem. If they're not, BIG problem called - tax evasion. Liable to fines and penalties I believe:eek: . As calley says the inland revenue have tighted up considerably and transactions just under the thresholds are likely to be more closely scrutinised than others. There's no limit as such but you may have to justify the amount and anything over £1K is likely to be examined. Speak to your solicitor but I think you'll find many wouldn't act for you if they felt the carpets/curtains figures were being inflated to avoid SDLT.

BTW, sorry to be the bearer of even worse news but the rate jumps from 1 to 3% [not 2] over £250K purchase price.

Best bet would be to use the stamp duty in your negotiations and try to get the vendor to meet some or all of the extra cost by reducing their price accordingly. At £270K it's going to be a big consideration for any potential buyer.

BoL.

shockingmoment

Doesn't avoid stamp duty - but why not get the seller to pay it as a 'discount'. Leaves you with some spare cash for decorating, carpets etc etc etc

Doozergirl

£250k is the nightmare mark. Sellers paying Stamp Duty looks good to start with, but it's still the buyer paying for that Stamp Duty on top of what the buyer takes home so there's no bargain to be had.

I'd tread very carefully with houses at that mark, checking sold prices as opposed to marketing prices and viewing many, many houses. I'd be looking hard to pay no more than £250k as any jitters in the market instantly send your house price under that mark. https://www.housepricemaps.co.uk was fantastic in helping me see the sheer number of purchases that occur within £1000 of £250k in my area and the derth of sales up to around £280k.

david29dpo

your solicitor HAS to inform in IR if he he thinks something is going on to avoid stamp duty. this is another burden which has been passed on to solicitors over the years. however i know 'someone' who paid £250000 for the house and £25000 in used notes pushed under the door sometime after the sale!!

mshevermoore

Thanks to everyone who replied to my dilemma. I was very surprised to receive so many constructive responses and so quickly. This is the first time I have used the forum and I'll certainly be using it again! Thanks again.:j