Super-rich dodging stamp duty

brit1234

ess0two wrote: »

It'll be non of them Chelsea properties,apparently you can rent them for £300 per month.

From £375 to key workers only.

Road_Hog

Turnbull2000 wrote: »

The trickle effect of the rich snapping up UK property (esp in London) is considered essential maintaining and boosting the value of our housing stock. For this reason, the government is unlikely to intervene.

No, the reason that this was set up, was so that Muslims could avoid paying interest which is illegal under sharia (their religious system of law and politics).

I can guarantee you 100% that this will not be revoked.

chewmylegoff

Road_Hog wrote: »

No, the reason that this was set up, was so that Muslims could avoid paying interest which is illegal under sharia (their religious system of law and politics).

I can guarantee you 100% that this will not be revoked.

Complete nonsense. This wasn't "set up" at all.

Stamp duty on shares is 0.5%. You still pay the same tax, just at a lower rate.

RenovationMan

brit1234 wrote: »

Super-rich costing the treasury £1bn a year by dodging stamp duty on their properties

We were given the option of doing something similar to this when we bought our house and it would have saved us a large part of the £13500 we paid in stamp duty. What put me off was the fact the the solicitor would have held onto the £13k stamp duty for something like 12 months until the end of a time limit and could give most of it back.

The downside was that if the solicitor went bust then my £13k could have gone with them and I'd still owe the Revenue another £13.5k. I like to take calculated risks (as can be seen with my interest rate gamble) but this was one risk too far.

I don't have a problem with people paying experts to help them avoid tax and had I had more confidence with the scheme I would have happily done it. Who wants to hand over £13k if they don't have to?

To be honest I think stamp duty is the most flawed and unfair tax we have in the UK. It's not graduated (i.e. when you go over a tax threshold, the new tax rate applies to the whole amount) and it's not based on income, it's taken from money that is borrowed or saved. A fairer tax would be on the sale of property when a profit has been made.

lostinrates

the_flying_pig wrote: »

A university friend of mine [who's loaded, think he spent over £1.5m on his house] bought about three years ago usnig a scheme a bit like this and the taxman has only just contacted him. He reckons he's going to have to pay up plus interest.

We looked in to it (these schemes btw are dvertised and available for any one stmp duty eligable) and came to the conclusion this would be the case and that were it not it was significantly far enough from the spirit of the law for it to be tolerable for us.

Stamp duty is huge cost for realtively normal homes in some areas though

chewmylegoff

The problem with this all is that by letting you live in the property, the company that owns the property is providing you with a taxable benefit, therefore if people actually paid the tax due under these arrangements they would be a lot worse off than if they just paid the stamp duty up front. Of course HMRC is so rubbish that nothing is done to enforce the law.

Jimmy_31

MrRee wrote: »

Why should we pay when there is a way around it?

Paying taxes is for the poor ....

Well said Mr Ree.

Now where did i put them invoices:rotfl:

the_flying_pig

lostinrates wrote: »

We looked in to it (these schemes btw are dvertised and available for any one stmp duty eligable) and came to the conclusion this would be the case and that were it not it was significantly far enough from the spirit of the law for it to be tolerable for us.

Stamp duty is huge cost for realtively normal homes in some areas though

i looked round a few houses in Surrey [Esher, Walton, Weybridge] one estate agency that's very active round there seems to [or at least some of the people who work there] actively encourage this kind of thing.

there's quite a hefty fixed cost of setting it up... and a good [i assumed 50% chance] you'll get collared in the end... so by my calculations it likely wasn't worth doing unless you were spending £1m or the best part thereof... and even then i'd say you've got to be, well, you've got to, well, have a relaxed attitude towards these things or else be spending loads [e.g. say £1.5m - over £2m it must be a complete no brainer that you'd try it]

chucknorris

the_flying_pig wrote: »

i looked round a few houses in Surrey [Esher, Walton, Weybridge] one estate agency that's very active round there seems to [or at least some of the people who work there] actively encourage this kind of thing.

there's quite a hefty fixed cost of setting it up... and a good [i assumed 50% chance] you'll get collared in the end... so by my calculations it likely wasn't worth doing unless you were spending £1m or the best part thereof... and even then i'd say you've got to be, well, you've got to, well, have a relaxed attitude towards these things or else be spending loads [e.g. say £1.5m - over £2m it must be a complete no brainer that you'd try it]

Do you happen to know what the costs are for setting up this scheme? Just asking out of curiousity I don't think it's something I would actually do (in any case I can't see us spending over £1m on a property).

tartanterra

brit1234 wrote: »

Super-rich costing the treasury £1bn a year by dodging stamp duty on their properties

Hardly a surprise is it?

Most people, irrespective of how much money they have, will always do their best to reduce their outgoing (especially to the taxman).

It's not a phenomenon that is exclusive to the rich.