Help buying a house - stamp duty - General Discussion

hazy-days · 28-04-2007, 16:58

My parents have been in rented for the past 12 months and have just this week found a house they really love. They were second to view it on the very first day. It's on the market at £249,950. They put an offer in at the asking price and were told that the couple before them had also put in an offer. They were back in touch this morning telling my parents the second couple matched our offer but they've secured it. So my mum was quite prepared to but another £2500 on the price but was advised by the estate agent (who is a bloke she knew at school) she didn't want to do that as she'd be paying stamp duty. So my mum said "well the other couple would be to surely?" and he said no. They're offer didn't exceed ours by much. So my mum said to round it up to a penny under stamp duty and he said there was still something she was missing but he couldn't say what. So I thought maybe fixtures and fittings/carpet and curtains. But he said that wasn't it either. He told her to go away and have a think about it but he couldn't tell us what the other couple had offered. So we're all pretty confused and thought maybe some DS members might be able to see something we're missing? They want this house so much and I'd hate to see them miss out after waiting all this time for their perfect property.

Any help would be greatly appreciated. Thanks.

28-04-2007, 17:07

I haven't a clue, but will be watching this thread to see what the answers might be!

I hope someone can suss it out for you.

PamelaL · 28-04-2007, 17:10

They've got a bigger deposit?

roland rat · 28-04-2007, 17:13

Quote:

Originally Posted by hazy-days

My parents have been in rented for the past 12 months and have just this week found a house they really love. They were second to view it on the very first day. It's on the market at £249,950. They put an offer in at the asking price and were told that the couple before them had also put in an offer. They were back in touch this morning telling my parents the second couple matched our offer but they've secured it. So my mum was quite prepared to but another £2500 on the price but was advised by the estate agent (who is a bloke she knew at school) she didn't want to do that as she'd be paying stamp duty. So my mum said "well the other couple would be to surely?" and he said no. They're offer didn't exceed ours by much. So my mum said to round it up to a penny under stamp duty and he said there was still something she was missing but he couldn't say what. So I thought maybe fixtures and fittings/carpet and curtains. But he said that wasn't it either. He told her to go away and have a think about it but he couldn't tell us what the other couple had offered. So we're all pretty confused and thought maybe some DS members might be able to see something we're missing? They want this house so much and I'd hate to see them miss out after waiting all this time for their perfect property.

Any help would be greatly appreciated. Thanks.

I suppose it could be anything, could the person have a holiday home in spain, and the sellers get 1-2 weeks holiday every year

Or the most obvious answer, they have paid in cash, not mortage

Spot · 28-04-2007, 17:15

The rate up to £250,000 is 1%, but then it jumps to 3%, and that's 3% on the whole amount. It's a crazy situation which means that if you offer £1 over the threshold, you have to cough up another £5,000 in stamp duty.

People sometimes get round it by offering to pay a bit extra separately for fixtures and fittings, like carpets or curtains, and I believe this is OK so long as the payment is reasonable.

28-04-2007, 17:19

Buying the land/garden and house seperately?

Spot · 28-04-2007, 17:20

Might it be that the others have offered a bit of extra cash in a brown envelope, which the agent can't advise them to do as it's advising them to avoid paying tax, but it still obviously happens in these circumstances?

28-04-2007, 17:21

They may have offered to split the stamp duty. This is quite common these days.

28-04-2007, 17:21

Paying their removal/legal fees/estate agency fees?

28-04-2007, 17:22

I'm clutching at straws here

oulandy · 28-04-2007, 17:28

Money under the table. This means the official price for stamp duty purposes remains below the threshold of £250 000, but the sellers get a bit of extra money over and above the official selling price.

skp20040 · 28-04-2007, 17:53

Basically as has been mentioned above , there is no stamp duty on fixtures and fittings. So you offer the seller the price for the house and then whatever else you offer but class it as being for fixtures and fittings , that way you do not pay over the odds on the stamp duty.

They do say that the price for fixtures and fittings has to be reasonable as Gordon Brown is upset his plan to make more money may not be making as much as he likes. However who is to decide what is reasonable. You cannot expect to offer another £5000.00 necessarily for carpets , but you could always offer another £5000.00 , and class it as £2500.00 for the carpets and curtains etc and then the other £2500.00 was for the lovely Grandfather clock in the hall, who is to prove there was never a Grandfather clock there , or for the beatuiful plants in the garden , if the revenue ever visit , you can say the clock got broken and thrown away and the plants died. ( not that I am suggesting people should do that of course ) .

horseychick28 · 28-04-2007, 18:58

Quote:

Originally Posted by Spot

The rate up to £250,000 is 1%, but then it jumps to 3%, and that's 3% on the whole amount. It's a crazy situation which means that if you offer £1 over the threshold, you have to cough up another £5,000 in stamp duty.

People sometimes get round it by offering to pay a bit extra separately for fixtures and fittings, like carpets or curtains, and I believe this is OK so long as the payment is reasonable.

This used to be a pretty popular way of getting round the extra stamp duty, however, the govt got wind of it so solicitor's are loathe to do it now, it must be money in a brown envelope me thinks?

However, I wouldn't do this however much you want the house, it's a huge risk and if the house falls through there's nothing to say they'll get the 'brown envelope' money back!

oulandy · 28-04-2007, 19:00

But most people involved in house sales including estate agents will not want to get into arguments with the Revenue over fixtures and fittings and, if you notice, in this case the agent said it wasn't a payment for fixtures and fittings. That's why it is more likely to be a payment under the table.

seacam · 28-04-2007, 19:36

Quote:

Originally Posted by hazy-days

My parents have been in rented for the past 12 months and have just this week found a house they really love. They were second to view it on the very first day. It's on the market at £249,950. They put an offer in at the asking price and were told that the couple before them had also put in an offer. They were back in touch this morning telling my parents the second couple matched our offer but they've secured it. So my mum was quite prepared to but another £2500 on the price but was advised by the estate agent (who is a bloke she knew at school) she didn't want to do that as she'd be paying stamp duty. So my mum said "well the other couple would be to surely?" and he said no. They're offer didn't exceed ours by much. So my mum said to round it up to a penny under stamp duty and he said there was still something she was missing but he couldn't say what. So I thought maybe fixtures and fittings/carpet and curtains. But he said that wasn't it either. He told her to go away and have a think about it but he couldn't tell us what the other couple had offered. So we're all pretty confused and thought maybe some DS members might be able to see something we're missing? They want this house so much and I'd hate to see them miss out after waiting all this time for their perfect property.

Any help would be greatly appreciated. Thanks.

Hello Hazy,

Duck as I throw a mallet your way.

The thing that's missing is a back hander, a contribution to his pension fund,-----getin it.

28-04-2007, 19:48

Quote:

Originally Posted by seacam

Hello Hazy,

Duck as I throw a mallet your way.

The thing that's missing is a back hander, a contribution to his pension fund,-----getin it.

I never thought of the estate agent

28-04-2007, 16:58	#1
hazy-days Forum Member Join Date: Oct 2005 Posts: 347	Help buying a house - stamp duty My parents have been in rented for the past 12 months and have just this week found a house they really love. They were second to view it on the very first day. It's on the market at £249,950. They put an offer in at the asking price and were told that the couple before them had also put in an offer. They were back in touch this morning telling my parents the second couple matched our offer but they've secured it. So my mum was quite prepared to but another £2500 on the price but was advised by the estate agent (who is a bloke she knew at school) she didn't want to do that as she'd be paying stamp duty. So my mum said "well the other couple would be to surely?" and he said no. They're offer didn't exceed ours by much. So my mum said to round it up to a penny under stamp duty and he said there was still something she was missing but he couldn't say what. So I thought maybe fixtures and fittings/carpet and curtains. But he said that wasn't it either. He told her to go away and have a think about it but he couldn't tell us what the other couple had offered. So we're all pretty confused and thought maybe some DS members might be able to see something we're missing? They want this house so much and I'd hate to see them miss out after waiting all this time for their perfect property. Any help would be greatly appreciated. Thanks. Last edited by hazy-days : 28-04-2007 at 17:11.

28-04-2007, 17:15	#5
Spot Forum Member Join Date: Aug 2002 Location: Norwich, Tacolneston tx Services: Namesco Broadband, Freeview, FTA DSat, DAB. Posts: 12,686	The rate up to £250,000 is 1%, but then it jumps to 3%, and that's 3% on the whole amount. It's a crazy situation which means that if you offer £1 over the threshold, you have to cough up another £5,000 in stamp duty. People sometimes get round it by offering to pay a bit extra separately for fixtures and fittings, like carpets or curtains, and I believe this is OK so long as the payment is reasonable. Last edited by Spot : 28-04-2007 at 17:19.

28-04-2007, 17:21	#9
snowstorms Posts: n/a	Paying their removal/legal fees/estate agency fees? Last edited by snowstorms : 28-04-2007 at 17:25.

28-04-2007, 17:53	#12
skp20040 Forum Member Join Date: Dec 2004 Location: Central London Services: Top Up Tv Anytime/Freeview/Bt Business Total Broadband Posts: 19,020	Basically as has been mentioned above , there is no stamp duty on fixtures and fittings. So you offer the seller the price for the house and then whatever else you offer but class it as being for fixtures and fittings , that way you do not pay over the odds on the stamp duty. They do say that the price for fixtures and fittings has to be reasonable as Gordon Brown is upset his plan to make more money may not be making as much as he likes. However who is to decide what is reasonable. You cannot expect to offer another £5000.00 necessarily for carpets , but you could always offer another £5000.00 , and class it as £2500.00 for the carpets and curtains etc and then the other £2500.00 was for the lovely Grandfather clock in the hall, who is to prove there was never a Grandfather clock there , or for the beatuiful plants in the garden , if the revenue ever visit , you can say the clock got broken and thrown away and the plants died. ( not that I am suggesting people should do that of course ) . Last edited by skp20040 : 28-04-2007 at 18:07.

28-04-2007, 17:07	#2
snowstorms Posts: n/a	I haven't a clue, but will be watching this thread to see what the answers might be! I hope someone can suss it out for you.

28-04-2007, 17:10	#3
PamelaL Forum Member Join Date: Jun 2004 Location: Worcestershire Posts: 55,222	They've got a bigger deposit?

28-04-2007, 17:19	#6
snowstorms Posts: n/a	Buying the land/garden and house seperately?

28-04-2007, 17:20	#7
Spot Forum Member Join Date: Aug 2002 Location: Norwich, Tacolneston tx Services: Namesco Broadband, Freeview, FTA DSat, DAB. Posts: 12,686	Might it be that the others have offered a bit of extra cash in a brown envelope, which the agent can't advise them to do as it's advising them to avoid paying tax, but it still obviously happens in these circumstances?

28-04-2007, 17:21	#8
monkey toes Posts: n/a	They may have offered to split the stamp duty. This is quite common these days.

28-04-2007, 17:22	#10
snowstorms Posts: n/a	I'm clutching at straws here

28-04-2007, 17:28	#11
oulandy Forum Member Join Date: Sep 2005 Posts: 12,990	Money under the table. This means the official price for stamp duty purposes remains below the threshold of £250 000, but the sellers get a bit of extra money over and above the official selling price.

28-04-2007, 19:00	#14
oulandy Forum Member Join Date: Sep 2005 Posts: 12,990	But most people involved in house sales including estate agents will not want to get into arguments with the Revenue over fixtures and fittings and, if you notice, in this case the agent said it wasn't a payment for fixtures and fittings. That's why it is more likely to be a payment under the table.