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do you pay stamp duty on dwelling + land?
ceinwen_2
Posts: 14 Forumite
We've been offered a small equestrian farm with 17 acres of land and have agreed a price of £500k. Great..until we realised that stamp duty is 3% above £350K ! So that's an extrta £15,000.
A shock to the system I can tell you! Should've done our homework I know, but I had a thought that we could buy the land and the bungalow separately to avoid paying as much tax.
Does stamp duty apply to land?
ALSO...
We'll be bringing £200k, and my other thought..yes I've been very busy...is to pay the farmer £200K separately so the tax man would only think we'd paid £300k , not £500. Genius!!
Is this feasible or just optimistic?
Has anyone else done this before and what, if any, complications arose?
A shock to the system I can tell you! Should've done our homework I know, but I had a thought that we could buy the land and the bungalow separately to avoid paying as much tax.
Does stamp duty apply to land?
ALSO...
We'll be bringing £200k, and my other thought..yes I've been very busy...is to pay the farmer £200K separately so the tax man would only think we'd paid £300k , not £500. Genius!!
Is this feasible or just optimistic?
Has anyone else done this before and what, if any, complications arose?
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Comments
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Is this feasible or just optimistic?
Im sorry to say this sounds illegal to me, and no solicitor should be defrauding the system like this. Yep, its a lot of money, but you dont HAVE to buy the farm. Sorry to be the bearer
:beer: Well aint funny how its the little things in life that mean the most? Not where you live, the car you drive or the price tag on your clothes.
Theres no dollar sign on piece of mind
This Ive come to know...
So if you agree have a drink with me, raise your glasses for a toast :beer:0 -
Hi, my DH and I bought some land a few months ago, yes unfortunatly:mad: stamp duty is payable on land aswell as dwellings.
With regards to your other suggestion, we thought about that, i.e breaking the land into smaller amounts, but it was a definate no,no.
hope this helps
EmmaOS Grocery Challenge
August £250/ £103.44 left0 -
It's not a definite no-no, it's just is it worthwhile to spend a fortune on lawyers fees and setting up offshore trust and companies to avoid £15k. Madge & Guy did it, but we are talking £M here.A house isn't a home without a cat.
Those are my principles. If you don't like them, I have others.
I have writer's block - I can't begin to tell you about it.
You told me again you preferred handsome men but for me you would make an exception.
It's a recession when your neighbour loses his job; it's a depression when you lose yours.0 -
well...it was worth asking anyway!0
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Oh yes...thanks for your replies0
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You have to pay stamp duty on land. But there is a way around it.
First my story so you know where I am coming from. I am buying a city centre apartment for £137,288 with a car park space for which I am being charged an extra £20,000. Where I will live is a regeneration area, where the stamp duty threshold is £150,000. See where I am coming from? I pursued the chance to not pay stamp duty, and it all comes down to leases / freeholds. If the land and the place comes under the same one, there is no way around it. Our Solicitor informed us that had the car park space had a seperate lease etc. (and could be sold seperately) then we wouldn't have to pay stamp duty as they are not within the same document.
The Inland Revenue would say otherwise, as they would claim it is a "linked transaction" and would argue your mortgage covers them both, but of course, they would say that.
So in short, see if you the deeds to the land can be done seperately and you might save yourself a small fortune.
Good luck.0 -
Take legal and accountancy advise on this one. Is it possible to buy the land as a seperate transaction from the house so that one if not both are below the tax threshhold ? Just a thought!!!!0
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