WHAT IS STAMP DUTY?
Stamp Duty is a tax charged on instruments ( written documents) which transfer the ownership of property.We usually become aware of stamp duty when purchasing our homes.
PROPERTY includes land, buildings, business assets ( for example goodwill), shares, stock and marketable securities.
Stamp Duty is also payable on certain LEASES and agreements to lease.
We also pay Stamp Duty on
FINANCIAL CARDS such as debit cards and on our credit card accounts.
LEVIES such as life insurance premiums, non life insurance premiums, pensions, health insurance contributions
TRANSFERS OF STOCK or marketable securities where the transfer takes place electronically through CREST ( Electronic Share Trading).
WHO HAS TO PAY STAMP DUTY?
The accountable person pays Stamp duty. The accountable person is the person receiving the property.
However, where the property transferred is a gift, then all parties to the instrument are accountable persons.
If the accountable person dies before paying Stamp Duty, then his or her personal representative ( such as his or her executor) becomes liable.
Where there are more than one accountable person then they are jointly and severally liable to pay the Stamp Duty.
WHAT ARE THE RATES OF STAMP DUTY ?
For residential property stamp duty is calculated at 1% where the purchase price is up to €1 million.
Where the purchase price is greater that €1 million the excess is charged at 2%.
For new builds, while VAT is paid on the purchase of a new property, stamp duty is paid on the price excluding VAT.
For non residential property Stamp Duty is charged at a rate of 6%.
Where a purchaser purchases a site with an arrangement to build on it, stamp duty will be charged at the residential rate on the total cost of the site and the building cost.
Where a purchaser purchases a site and there is no connected arrangement to build a house on it then stamp duty is charged at the non residential rate on the cost of the site.
WHEN DOES STAMP DUTY BECOME PAYABLE?
You must file your return and pay your stamp duty within 30 days of the instrument being signed to ensure that no interest or late filing surcharge are incurred. Revenue allows a further 14 days before charging interest and a late filing surcharge.
Usually the solicitor for the purchaser of property will file the return and make the payment of Stamp Duty to Revenue on behalf of the purchaser.
ARE THERE ANY EXEMPTIONS FROM STAMP DUTY?
Yes. for example there is no Stamp Duty and no requirement to file a return where the instrument creates a joint tenancy of the family home between spouses or civil partners.
Nor is there any Stamp Duty or a requirement to file a return in the case of a lease for residential property which is for a period of 35years or less or an indefinite period and where the annual rent is less than €40,000.
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