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Stamp duty query
Kiwi08
Posts: 1 Newbie
I'm in a slightly unusual situation in that the house my partner and I are first time buyers, the house we are buying is worth £425,000 but the mortgage I have is for £300,000 - as the remaining value is a gift of equity from my parents.
Do I have to pay stamp duty?
Is stamp duty based on the consideration value - the £300,000 or the property value - £425,000?
Thank you
Do I have to pay stamp duty?
Is stamp duty based on the consideration value - the £300,000 or the property value - £425,000?
Thank you
0
Comments
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based on the value of the property - you get discount if it's first time buyer and it depends if you're in england Wales or scotland.
Your solicitor will sort it out for you0 -
I'm assuming that the property isn't being bought by you from your parents...?I'm in a slightly unusual situation in that the house my partner and I are first time buyers, the house we are buying is worth £425,000 but the mortgage I have is for £300,000 - as the remaining value is a gift of equity from my parents.
Do I have to pay stamp duty?
Is stamp duty based on the consideration value - the £300,000 or the property value - £425,000?
"The consideration" is the amount you're paying. £425k.
You might not be funding the £125k out of your own pocket, but it's going from you to the vendors. The fact it's going from your parents to you then on to the vendor is irrelevant to the actual sale.
If it is being bought from your parents, then HMRC will view it as a below-market-value transaction between related persons, which is exactly what it is, and treat it as if the transaction was at the market value.
Either way, you're paying SDLT on £425k - £6,2500 -
I'm in a slightly unusual situation in that the house my partner and I are first time buyers, the house we are buying is worth £425,000 but the mortgage I have is for £300,000 - as the remaining value is a gift of equity from my parents.
Do I have to pay stamp duty?
Is stamp duty based on the consideration value - the £300,000 or the property value - £425,000?
Thank you
Are you buying the property from your parents?0 -
If it is being bought from your parents, then HMRC will view it as a below-market-value transaction between related persons, which is exactly what it is, and treat it as if the transaction was at the market value.
Citation for this? It's how Capital Gains Tax is treated, but not SDLT AFAIK.0
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