Stamp Duty Avoidance

[Moshe Gariani]

Mrs G and I are in the process of moving house...

We have seen a house we like priced at £269,950

I'm going to offer £250,000 as an opening bid, but if the seller wants a bit more than that (as he probably will - up to £265,000...?) - what is the best way of avoiding the SD? anyone got recent personal experience?

over to the NSC financiers

 

[Stinky Kat]

The simplest way would be pay him 250k on the books and the rest in cash - it involves trust I suppose.

 

[Barnet Seagull]

All you can do is Offer £250k. Then additional (but not over the money) for any fixtures and fittings to up the price.

Any other deal is FRAUD.

We put out flat on for £264,950 hoping for but not expecting any more than £250k.

If you offer 250k you'll probably find your offer accepted. I reckon.

 

[Albion Dan]

The simplest way would be pay him 250k on the books and the rest in cash - it involves trust I suppose.

That wouldnt look suspect then!! Highly unlikely youll get away with that.

The best thing to do is ask the seller if he will make up the difference in Stamp Duty, or meet you 50/50. The price of his property will be a problem for him as people will be reluctant to so narrowly over the £250k mark.

 

[Chicken Run]

Unfortunatly the days of chattells are long gone and I'm afraid with the Lawyers and YOU the buyer under the spotlight and if caught will face heavy fines! Sorry

 

[Moshe Gariani]

cheers...

we know that he turned down £262,500 a month ago just after having come on the market, so there's not much chance of the straight £250,000 being accepted

apparently the old fixture and fittings scam has been squeezed recently with solicitors now only allowing 2 or 3 grand in contracts - so it looks like if he does want more for it then it will have to be the brown envelope option...

 

[The Wookiee]

Tell the vendor to accept £250,000 which is then your 'official offer' through the estate agent and solicitor.

Then pay the vendor a seperate sum for the difference of the original asking price. Which can be for 'furniture and other fixtures and fittings' that were not part opf the original sell.

 

[Moshe Gariani]

Tell the vendor to accept £250,000 which is then your 'official offer' through the estate agent and solicitor.

Then pay the vendor a seperate sum for the difference of the original asking price. Which can be for 'furniture and other fixtures and fittings' that were not part opf the original sell.

sounds good - have you done that recently?

 

[Chicken Run]

Tell the vendor to accept £250,000 which is then your 'official offer' through the estate agent and solicitor.

Then pay the vendor a seperate sum for the difference of the original asking price. Which can be for 'furniture and other fixtures and fittings' that were not part opf the original sell.

At what stage is "the loot" handed over! After contracts have exchanged, risk to seller buyer not coughing up or before risk to buyer. Remember none of the above is leagal therefore there is no comeback!

 

[Moshe Gariani]

Remember none of the above is leagal therefore there is no comeback!

a manly handshake should be sufficient grounds on which to proceed...

 

[Chicken Run]

You'd be happy to shake hands on £15k

 

[The Wookiee]

sounds good - have you done that recently?

Have never tried it myself, but it sounds OK to me.

I suppose you could do it legally and get the vendor to accept £250,000 for the property and £15,000 for the fixtures and fittings, this I suppose could be done through the solicitor on two seperate transactions ?

 

[Chicken Run]

Have never tried it myself, but it sounds OK to me.

I suppose you could do it legally and get the vendor to accept £250,000 for the property and £15,000 for the fixtures and fittings, this I suppose could be done through the solicitor on two seperate transactions ?

I'll say again NO solicitor will get involved, if caught they face heavy penalties aswell as the individual avoiding!

 

[Napper]

by pass estate agents . . .they are all w~* kers

 

[Moshe Gariani]

I'll say again NO solicitor will get involved, if caught they face heavy penalties aswell as the individual avoiding!

that is correct... the most a solicitor will alow for F&F (or "chattels") is about £3,000...

if our seller wants another £10 grand or so then it will take the form of a separate transaction after the house sale (e.g. we'll buy some furniture or domestic appliances from him...)

the fact that, say £253,000, would only be a 6.3% reduction from the original asking price makes me think that there would be absolutely zero chance of any unwanted attention from the revenue... (surely they are only interested if a house sells for £250,000 that appears to be worth a great deal more...)

 

[Rangdo]

Whats the difference in stamp duty once you go over £250000 just out of interest?

 

[Moshe Gariani]

Whats the difference in stamp duty once you go over £250000 just out of interest?

jumps from 1% to 3%... i.e. you pay 5 grand more at £250,001 than at £250,000

 

[Theatre of Trees]

Unless you can get hold of £15k in cashwithout it looking too suspicious it's probably a non-starter. I know somebody who agreed purchased a £260k house officially for £250 plus secretly added £5k in cash but then they did most of their business dealings in cash and had enough on them to do this.

 

[Collar Feeler]

I have just bought a house for £255k which was the lowest I could get the seller to accept despite every attempt to make her see it from our perspective i.e 3% stamp duty on the WHOLE sale price instead of 1% if she had accepted £250k. We tried every trick in the book to avoid or offset the extra stamp duty but both solicitors and the Inland Revenue were having none of it!

We couldn't even get the Inland Revenue to accept that £5000 was a fair price for fixtures and fittings! And this was in spite of the fact that the new house had an expensive Aga cooker worth about £4000!! Apparently is wasn't movable so constituted part of the fabric of the house, bastards! Anyway we had to accept in the end that we were getting stung for the extra stamp duty so the extra £5000 on the asking price is in fact costing us about £10000!! and not £5000.

What i would say is that solicitors and the inland revenue appear very clued up on this area and you stand little or no chance of officially avoiding the extra stamp duty. Any private agreement between you and the seller would only be based on trust and with the obvious risks that the buyer simply didn't hand the cash over on completion. I certainly wouldn't agree to such an arrangement with a complete stranger buying my house! The other angle is that if you chose to make an off the record agreement with the seller then you would be commiting an offence which the Inland Revenue would vigourously pursue. They said as much to me in their letter when I was trying to get them to accept £5000 as a fair figure for fixtures and fittings. Apparently, not only would you then get stung for the extra stamp duty but would incur a very hefty fine as well.

So my advice would be don't even think about trying the official avenues and be very very careful and wary about making any other arrangement.

 

[Chicken Run]

I have just bought a house for £255k which was the lowest I could get the seller to accept despite every attempt to make her see it from our perspective i.e 3% stamp duty on the WHOLE sale price instead of 1% if she had accepted £250k. We tried every trick in the book to avoid or offset the extra stamp duty but both solicitors and the Inland Revenue were having none of it!

We couldn't even get the Inland Revenue to accept that £5000 was a fair price for fixtures and fittings! And this was in spite of the fact that the new house had an expensive Aga cooker worth about £4000!! Apparently is wasn't movable so constituted part of the fabric of the house, bastards! Anyway we had to accept in the end that we were getting stung for the extra stamp duty so the extra £5000 on the asking price is in fact costing us about £10000!! and not £5000.

What i would say is that solicitors and the inland revenue appear very clued up on this area and you stand little or no chance of officially avoiding the extra stamp duty. Any private agreement between you and the seller would only be based on trust and with the obvious risks that the buyer simply didn't hand the cash over on completion. I certainly wouldn't agree to such an arrangement with a complete stranger buying my house! The other angle is that if you chose to make an off the record agreement with the seller then you would be commiting an offence which the Inland Revenue would vigourously pursue. They said as much to me in their letter when I was trying to get them to accept £5000 as a fair figure for fixtures and fittings. Apparently, not only would you then get stung for the extra stamp duty but would incur a very hefty fine as well.

So my advice would be don't even think about trying the official avenues and be very very careful and wary about making any other arrangement.

Could'nt put it better myself