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

GreenSnake

SDLT_Geek wrote: »

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.

Is the registry retrospective?
i.e. does it still show me as a previous owner on houses I've sold in the past?
What if someone has changed their name since?

Does the land register include NI number?
That would be tricky for finding non UK citizens who own property here, wouldn't it? Seeing as how they don't have a NI number?

Wouldn't fit well with the British Government's plan to create the world's top money laundering destination for foreign citizens!

Thrugelmir

GreenSnake wrote: »

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

Then you need to weigh up the risk. The downside is there's the original tax to pay, a penalty which can up to 100% of the tax involved if there is intent not to disclose the tax due, interest from the tax was originally due to be paid.

Modern technology makes joining the dots so very much easier.

uknick

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 ...

I should have made it clear in my last post, to the best of my knowledge, he never spent a penny of capital spend on the property. Nor, did he ever live in it to allow him to claim the relief that entails.

Anyway, my question has been answered and it does appear I did tell him the right thing. It's up to him if he wishes to buy as a FTB and try his luck. Personally, I can't see the point in taking a risk as SDLT will only be about £2k for the property he has in mind.

GreenSnake

If he's sold all his other properties (in the whole world!), then he won't be liable for the extra 3% stamp duty anyway.

The first time buyer stamp duty exemption is only relevant for high value properties anyway. Most houses are still under the threshold for non landlords.