Stamp Duty

borichnuke

borichnuke

borichnuke

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3 Jul 2007
Posts
107
My parents have offered me their house to buy in Cornwall as they will be retiring and moving into there other house in a few years. Until then they intend to live in the house I buy off them while I keep working up in London. Now the problem I’m faced with is the issue of Stamp Duty. The house is worth between 300k- 350k atm, when completed (garage, etc) it will be nearer the 400k mark. My parents want 65k for it, which gives them enough money to retire on, as they have funds else where and I am not going to be stuck with a high mortgage. However is there a legal way I can avoid paying stamp duty, as I will be paying the buyer (parents) less than the 150k threshold for stamp duty. Or will the taxman see the house is being sold less than it’s valued at and then demand his % still.

Secondly worse case, I have to pay the stamp duty which is around 9k if the house is valued at 300k, When would this fee be due? As if I do have to pay it then I would simply take out an extra 10k on the mortgage which would cover these fees. Or does this need paying prior to getting the mortgage?

Borich
 
Think Capital Gains tax! Selling houses like this is a very risky business as has been said go and see a good solicitor or maybe a financial advisor as they should know the ins and outs of dodging inheritance tax which is effectively what you are trying to do.
 
My friend is in the same boat as you as he dad owns about 12 houses, yep loaded but not flashy with it. He is having loads of issues so I wish you well. :-)
 
Can you not just get your parents to change the name on the house to yours and just give them the 65k? As long as nothing happens to both your parents in the 7 years following the change over I believe you can avoid Inheritance tax. Obviously you would avoid stamp duty doing this as well.

Check it out with a solicitor though.
 
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