How do the authorities check if someone is a first time buyer?

GreenSnake

theartfullodger wrote: »

They monitor forums and get real names of users then work from there. Simple really.

Mr and Mrs Snake have nothing to hide.

uknick

Thanks for the responses.


Did he tell the HMRC about his latest sale which was a 2nd property? He wasn't going to, but had no choice as the conveyancing solicitor had to complete forms telling HMRC. However, the purchase price he told the solicitor was £190k, despite only buying it for £90k, therefore cutting his gain from £160k to £60k. Apparently he spent a lot on improving it, which was news to me. I'm sure he's hoping HMRC don't ask for the receipts.

GreenSnake

uknick wrote: »

Thanks for the responses.


Did he tell the HMRC about his latest sale which was a 2nd property? He wasn't going to, but had no choice as the conveyancing solicitor had to complete forms telling HMRC. However, the purchase price he told the solicitor was £190k, despite only buying it for £90k, therefore cutting his gain from £160k to £60k. Apparently he spent a lot on improving it, which was news to me. I'm sure he's hoping HMRC don't ask for the receipts.

I've bought two houses in the past. Both under the stamp duty threshold.
The solicitor still had to complete a form for HMRC. So HMRC will have a record of how much was paid, i.e. £90k. The purchase price may well be public information anyway, via land registration. Just Google the address and house price history.

Marvel1

Leave him to it, let him learn.

GreenSnake

cjdavies wrote: »

Leave him to it, let him learn.

I thought everyone knew that house purchase prices were public knowledge?
How else would we really know what house prices were?

GreenSnake

Anyone can find out who owns a house (as long as it's registered). Only costs about £3.
Anyone can find out what was paid for a house, going back about 10-20 years, I think?

But what you can't do, is search under someone's name, to see what houses they own. You have to search under the address.

Probably LR can do such a search. But it would probably throw up about a million hits under John Smith, etc.

Tirian

Some capital expenses can be offset against capital gains. e.g. if you spent £50,000 on a big extension then you would not have to pay capital gains on £50,000 worth of an increase in value over what you paid for the property.

That much is right and legitimate - the tax is on the the difference between what you have paid for and what you have sold for. If you paid £100k purchase plus £50k improvement then you have paid £150k for the property overall.

Your brother has taken a gamble that HMRC won't query the capital expenditure, by the sounds. He may be right. He may not.

My brother works in the department of HMRC that goes through records and reports of various sorts and decides who they need more info from - so I can tell you for certain that it's not a risk-free bet ...

GreenSnake

Tirian wrote: »

Some capital expenses can be offset against capital gains. e.g. if you spent £50,000 on a big extension then you would not have to pay capital gains on £50,000 worth of an increase in value over what you paid for the property.

That much is right and legitimate - the tax is on the the difference between what you have paid for and what you have sold for. If you paid £100k purchase plus £50k improvement then you have paid £150k for the property overall.

Your brother has taken a gamble that HMRC won't query the capital expenditure, by the sounds. He may be right. He may not.

My brother works in the department of HMRC that goes through records and reports of various sorts and decides who they need more info from - so I can tell you for certain that it's not a risk-free bet ...

These days it's worth remembering about capital losses, rather than gains!

Spending £50k on a house, will probably raise its resale value by about £20k maximum.

bobobski

GreenSnake wrote: »

Quite a lot of land ownership has never been registered with the land registry in this country anyway. Not sure if this includes dwellings? I seem to recall looking up a few houses in the past, only to find they'd never been registered.

Yes but since 2003 selling a property triggers compulsory first registration and it seems OP's brother has done exactly this: https://www.gov.uk/government/publications/first-registrations/practice-guide-1-first-registrations#compulsory-applications-for-first-registration.

SDLT_Geek

GreenSnake wrote: »

Probably LR can do such a search. But it would probably throw up about a million hits under John Smith, etc.

HMRC can and do search against the proprietorship register at the Land Registry for a person's name. I have seen a case recently where they did exactly that and asked why the 3% surcharge had not been paid on a recent purchase, having found a property inherited many years before by the same person.