Reply to: Avoiding 3% stamp duty

[Lewis]

Googling for the details I came across a story saying that HMRC have now taken steps to block people taking the mickey.

Reading this BBC News - Budget 2012: New stamp duty plans are outlined it says that one trick people use is to set up a limited liability company to buy the property which then sells it immediately to the individual. But it says this is not being clamped down on. That suggests to me that any random contractor with a limited company could do this. I've got no plans to move, and wouldn't do it anyway, but I'd still be interested to know if people are doing this.

It also says that the off-shore company ownership thing has only been clamped down on properties over £2m. So does that mean the loophole still exists for properties <£2m - what sort of pathetic clampdown is that?!

[BrilloPad]

Re-opening 4 year threads on legislation that can change a few times a year... useful..

yes. those who reopen old threads should be banned.

[northernladuk]

Re-opening 4 year threads on legislation that can change a few times a year... useful..

[Wanderer]

I have heard of ways and means to sell a house worh more than £250K at under £250K and cash balance the remaining money to avoid 3% stamp duty. anyone happen to know more about this out of interest? As only £10K or so over the £250K threshold I do not consider this too cheeky!

It used to be that you could sell the house for £250k + £10k for fixtures and fittings which weren't included in the price.

Indeed, Peter Mandelson did just that on a flat purchase in Notting Hill in circumstances which has been widely reported and questioned. At the time, we were assured that it was "standard practice".

Googling for the details I came across a story saying that HMRC have now taken steps to block people taking the mickey.

If the amount over £250k is relatively small then you may be able to legally come to some arrangement, but if it's 10s of thousands then your buyer is probably going to have to suck it up.

If your solicitor is any good then they should be able to advise you what's possible.

[moggy]

But then you'd have to pay VAT.

not if its cold

[GillsMan]

In Norway, it's illegal for touts to resell tickets to sporting events, concerts etc. at a higher price. But it's not illegal to sell a package deal (e.g. coach trip + meal + show) that includes the ticket. So you end up getting blokes outside stadiums who'll sell you a kebab for £200 with a ticket included. Maybe you could get the vendor to sell you a £260,000 Spaghetti Bolognese with a free house thrown in.

But then you'd have to pay VAT.

[easyrider]

If you're rich enough then you can always offshore ownership of the house to a compnay, then buy the company (like the spag bol suggestion).

Super-rich dodge stamp duty while families pay tens of thousands | This is Money

I'm in the same situation....the problem would seem to be reliable transfer of funds, some sort of escrow payment would be ideal.

Wonder if the vendor would accept paypal?

[NotAllThere]

Last edited by Turion : Yesterday at 00:57. Reason: spelling

Was that so you could put incorrect spelling or take it out?

Wilmslow

Wilmslooooooooooooooooooooooooow (canned laughter)

[Turion]

I intend to commit tax fraud and thought it would be a good idea to ask how on a web forum which is known to be read by the tax authorities.

I'm impressed! The taxman is probably in his shed now working on a brown envelope and black money detector.

I say bring it on

PS: This is my last post - there's bound to be a price on my head now. I'm a dispearin' pronto like. Wilslow, you better do same, but with all those clues you have given about your location, I think it's game over for you.

[Platypus]

By possible do you mean legal? They are two very different things.

You don't say? I guess the mention of a brown envelope and black money weren't enough of a clue then?

[NickFitz]

I have heard of ways and means to sell a house worh more than £250K at under £250K and cash balance the remaining money to avoid 3% stamp duty. anyone happen to know more about this out of interest? As only £10K or so over the £250K threshold I do not consider this too cheeky!

I intend to commit tax fraud and thought it would be a good idea to ask how on a web forum which is known to be read by the tax authorities.

[thunderlizard]

In Norway, it's illegal for touts to resell tickets to sporting events, concerts etc. at a higher price. But it's not illegal to sell a package deal (e.g. coach trip + meal + show) that includes the ticket. So you end up getting blokes outside stadiums who'll sell you a kebab for £200 with a ticket included. Maybe you could get the vendor to sell you a £260,000 Spaghetti Bolognese with a free house thrown in.

[tim123]

1) Get better price
2) Not necessary

I know that there was two question marks. But there wasn't two questions.

tim

[Turion]

Why would the seller enter into such an arrangement? How could he possibly enforce payment?

tim

1) Get better price
2) Not necessary

[tim123]

Quite possible to do. Private arrangement between buyer and seller obviously, with a brown envelope containing the black money handed over to the seller as contracts are exchanged.

Why would the seller enter into such an arrangement? How could he possibly enforce payment?

tim