£250k house plus fixtures and fittings. Advice please.

ought

Hello there,

I know there have been several threads similar to this before but I could do with some advice please.

We have found a house that we think is worth £250k at most, and due to its location near to aging parents we are willing to pay that. But the vendor needs more to move.

We are not willing to pay more than the value of the house at £250k especially as it means the extra stamp duty tax, which we don't think we would ever get back if we have to sell in a year or two, as is quite possible.

The estate agent wanted me to set a figure I am willing to pay for fixtures and fittings, but I refused, saying I am willing to pay what they are actually worth.

So, the vendors have come up with a list that brings up a total of over £3000, with what to me look like original purchase prices, such as £500 for a washer dryer. I think it is because they need this much to move.

I want to be honest and am not willing to risk the wrath of HMRC or a criminal record. But likewise I am not able to pay £253k for the house because it is barely worth that and because of the extra tax, though I am willing to pay for fixtures and fittings.

Should I bite the bullet and accept the valuations from the seller, or should I run away?

Thanks!

Mr_Moo_2

Walk away, or take advice from your conveyancer (who may also advise the same!). Not worth the hassle unless this is a real dream house for you, and if you're contempating moving again in 2 years then it's probably not that?

If you're really contemplating moving again in such a short timeframe, is it worth buying given the costs involved?

hazyjo

You might as well be taking out a loan to fund their loss!

Entirely your decision - but I'd leave a £250k offer on the table and certainly wouldn't want to pay more for F&Fs (unless it was for say a thousand for a decent table & chairs, washing machine, sofas, etc). The items you list (presuming previously used) should be offered at second hand prices (as you're well aware). The EA will also be aware, so I'd tell them to let their clients know.

Jx

mrginge

If i was buying at the 250k mark i wouldn't include any f+fs as even if it a relatively small amount you are just asking for the hmrc to look closer.

Tell the ea that you're not interested in committing fraud. 250k or you walk.

ought

I am definitely not inrested in comitting fraud.

I have calculated what I consider to be a reasonable used value for the items they list, and added carpets. Now it comes to just under £1400.

I think I will tell the agent that this is the fair value I wish to pay for the items.

Sounds ok?

adamzetec

The 3% stamp duty threshold is a huge psychological barrier and certainly increases the expense considerably.

However, if they accepted £250k + fixtures and fittings, would you be prepared to add an extra £1/2k to save yourself the stamp duty?

You need to ask yourself it it's worth letting it go.

mrginge

ought wrote: »

I am definitely not inrested in comitting fraud.

I have calculated what I consider to be a reasonable used value for the items they list, and added carpets. Now it comes to just under £1400.

I think I will tell the agent that this is the fair value I wish to pay for the items.

Sounds ok?

No. It sounds like a stupid idea.
What value have you put on second hand carpets btw?

ought

Heh. Why is it a stupid idea to pay what the items are worth?

Carpets at £50,£40,£50.

Fire_Fox

Read the HMRC guidance, discuss this with your conveyancing solicitor then go back to the vendors and say you have been advised overpaying for fixtures and fittings is tax evasion (not fraud). http://www.hmrc.gov.uk/manuals/sdltmanual/Index.htm

phoebe1989seb

Incurring the wrath of the taxman is definitely not something I'd want to do - especially if it involves paying extra for things that should be included in the sale such as second hand carpets

A few years back we sold a house for just under £600k and our buyers were very interested in purchasing some of our furniture etc and as we were downsizing a bit we were happy to do this so let them have the items we no longer required for (if I remember correctly) just over £5k (paid separately by cheque) - BUT of course we were nowhere near a SDLT threshhold so there was no chance that HMRC would see it as stamp duty avoidance shenanigans.......

However, we did have friends selling a house that would have easily been worth around £400k if it was in a more desirable area - unfortunately it wasn't and therefore despite it being both huge and beautifully appointed, it was only *worth* around £280k. In reality this meant they were never going to get any offers over £250k. Their buyers absolutely loved the house - which was a stand-alone property with nothing comparable on the market - but despite having more cash available, were dead against paying extra tax (:eek:), so instead they agreed a purchase price of £250k but slipped our friends a further £10k in cash without the knowledge of either the sellers' EA or the solicitors involved in the conveyancing.........this was a few years ago and as far as I'm aware HMRC never found out :mad:

Just goes to show you the lengths some people will go to to avoid paying tax - as I guess the £10k must have actually more than the extra SDLT would have cost the buyers - who sound like they were total loons for taking that kind of risk!

Don't do it OP........

mrginge

ought wrote: »

Heh. Why is it a stupid idea to pay what the items are worth?

Carpets at £50,£40,£50.

Because if the taxman looks and decides that YOUR value is higher than theirs, then YOU get the extra 2% bill. Not the vendor or the EA.

So you take all the risk and get pretty much knack all for it.

I would price carpets at £0, £0 and £0.