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  • FIRST POST
    • bigk
    • By bigk 6th Aug 18, 6:38 PM
    • 28Posts
    • 8Thanks
    bigk
    stamp duty and incentives
    • #1
    • 6th Aug 18, 6:38 PM
    stamp duty and incentives 6th Aug 18 at 6:38 PM
    Sorry if this has been posted before but I have searched and found nothing! I am in the process of buying a new build. The builder has offered me 5% off as an incentive so my question is, do I pay stamp duty on the "gross" price or the"net" price (more likely)?
    I am not being given cashback but a straight discount although the paperwork describes it as an "incentive". The paperwork shows the higher price, then the money off marked incentive followed by the final net price. Thankyou.
Page 1
    • davidmcn
    • By davidmcn 6th Aug 18, 7:15 PM
    • 8,749 Posts
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    davidmcn
    • #2
    • 6th Aug 18, 7:15 PM
    • #2
    • 6th Aug 18, 7:15 PM
    You pay it on the net consideration.
    • kingstreet
    • By kingstreet 7th Aug 18, 9:12 AM
    • 34,221 Posts
    • 18,574 Thanks
    kingstreet
    • #3
    • 7th Aug 18, 9:12 AM
    • #3
    • 7th Aug 18, 9:12 AM
    A reservation will usually show the list price, then the contract price. The contract price is what you actually pay and this is the base for SDLT.

    The wording might then be "xx,xxx discount from the list price" and you will be able to see xx,xxx is the difference between the two figures above.

    A discount may not have been the developer's intention as this will lower the comparables (affecting the value of future plots when a surveyor inspects for mortgage purposes).

    If the reservation shows the same list and contract prices and then there is 5% shown as an incentive rather than a discount then you will pay SDLT on the higher "gross" price.

    Ask the developer to clarify if this is a discount or an incentive. For certainty, ask for a copy of the UK Finance Disclosure Of Incentives form as this will be provided to the surveyor doing your mortgage report & valuation.
    I am a mortgage broker. You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice. Please do not send PMs asking for one-to-one-advice, or representation.
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