House close to stamp duty threshold, what do we do?

DirtyLion

Looking at buying a farm house with a bit of land so please excuse the crazily high figures:o

It's on the market for just over a million, been on the market a while and we think it's worth somewhere around the mid £900k mark. The stamp duty jumps from 5% to 10% at £925k, 5% is just about doable for us but 10% and we're priced out. We're going to try but I honestly don't think they'd accept £924k, they might say yes to around £950k - £970k but the stamp duty will cripple us and it'll be a no-go.

I've been advised by a property developer friend to consider offering £924k then a sum of cash for appliances, farm machinery etc. Does this sound like a reasonable and acceptable thing to do or not?

Thanks

ACG

HMRC are all over that little tax avoidance/evasion scheme and you could find you get a fine and invoice for the difference down the line.

Offer what you think it is worth an explain why. They may not be aware that that is the reason why there have been no offers they have deemed acceptable (if any offers at all).

If they say no, you have wasted a phone call and you can move on.

sheff6107

I'd say go in at 924,999. The stamp duty figure is state of fact and they'll run into the same issue with other people.

Trying to avoid stamp duty with cash for appliances was doable back in the day but it's a no-no now.

dimbo61

It does not matter if this is a farmhouse with land or a studio flat in London once you go over £925,000 there is a hell of a stamp duty jump.
Offer what you can afford £924,995 and look elsewhere if they say NO

davidmcn

Are you sure you're calculating it correctly? It's no longer a "slab" system - the 10% is only on the bit over £925k, not the whole price e.g. on £924k it's £36200, on £950k it's £38750.

I'm assuming it counts as residential and that it isn't so agricultural that you're into commercial rates of SDLT.

DirtyLion

Thanks davidmcn, I did actually assume it would be 10% on the full amount. It may well be doable in that case. It's a residential property, no longer a working farm.

ACG

I assumed you were aware it went up in stages.
Have a read of this.
Put the figures in here - https://www.stampdutycalculator.org.uk/