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Original poster

Developer paying Stamp Duty on new build

21 replies

Autu · 01/12/2018 09:42

If you buy a new build having sold your previous home and the developer of the new build houses is offering to pay Stamp Duty on the new house which figure shows in your contract, your transfer document and on the Land Registry sold prices?

E.g. if house is listed for sale at £400,000 and the stamp duty on that is £10,000 and you agree to buy on this basis, does your TP1 say purchase price of £390k or £400k? And would the price shown on the Land Registry sold prices be the £390k or the £400k?

I know I would have to give the solicitor £400k (made up from mortgage plus our deposit) plus their fees but I’d like to know how the paperwork should show this afterwards.

OP posts:
chumbal · 01/12/2018 09:45

I would think it would say the price you paid for the house because the stamp duty is a tax

LondonMischief · 01/12/2018 09:52

The sale price will be £400k.

Original poster
Autu · 01/12/2018 09:53

Grin one of each! No wonder I can’t work it out!

OP posts:
NoArmaniNoPunani · 01/12/2018 10:16

400k. They agree to do this rather than drop the price so the sold price appears higher

chumbal · 01/12/2018 10:31

Ie 400k as that is the price of the house the tax is extra

wowfudge · 01/12/2018 11:51

It's £400k. The pps both said the same thing.

Original poster
Autu · 01/12/2018 14:44

Thanks for the replies. It’s potentially quite misleading as far as looking at sold prices online then as essentially the developer has given the buyer a huge discount but nobody can tell as it will look like they paid the full price.

OP posts:
DrDillWithIt · 01/12/2018 15:39

@Autu re: your last post - yep, that's exactly why they do it!

Lilmisskittykat · 01/12/2018 17:17

That's why they do it - to keep the sold prices higher on paper

Mummytowooter · 01/12/2018 17:26

Your purchase will be 400k. The stamp duty is additional

umpteennamechanges · 01/12/2018 17:31

You should be able to negotiate a good deal in the current market.

Don't just stop at stamp duty, see what else you can get too.

We got stamp duty and legal fees but also got some things thrown in for free which were supposed to be extra costs

  • Flooring throughout (c £7k)
  • Integrated washing machine, fridge freezer, dishwasher and tumble dryer (c £1.5k)
  • Lawn laid in back garden (£750)
Original poster
Autu · 01/12/2018 17:44

Don’t worry. I got stamp duty paid (which is actually just a discount to the value of the stamp duty) and a further discount. But the price which has just come up on the land registry following our purchase is the lower figure, which surprised me!

OP posts:
Original poster
Autu · 01/12/2018 17:48

I should add that another house in the development (which also had the stamp duty paid incentive) has come up on the Land Registry at the highest price (so including the stamp duty amount). The only difference I know of is that they didn’t have a mortgage and we did. Can’t see how that would alter things though.

OP posts:
LondonMischief · 01/12/2018 17:59

It sound like you did not get stamp duty paid but a discount on the house.
Did you have to come up with the cash for the stamp duty or did the developer transfer this to your solicitors?

Original poster
Autu · 01/12/2018 19:23

The amount of money we gave the solicitors was the same as the other plot gave theirs. It’s just how it was documented that was different. The solicitor sends some funds to the developer and some to HMRC either way surely.

OP posts:
wowfudge · 01/12/2018 21:34

Hmm - something doesn't add up. I'd be checking whether the stamp duty was paid.

Original poster
Autu · 02/12/2018 16:47

Why does this imply that the stamp duty may not have been paid. Using the figures in the example the solicitor had £400 and would have paid £390k to the developer and £10k to stamp duty.

OP posts:
wowfudge · 02/12/2018 16:57

Because if the builder is paying the stamp duty, you still pay £400k to buy the house unless you actually mean you agreed a purchase price of £390k - your posts aren't particularly clear. The builder pays the stamp duty. Unless the builder gave you a sum of money directly for the stamp duty, they will have either paid it to your solicitor or direct to HMRC. It is normal to pay your own stamp duty direct rather than through your solicitor, for which they may charge you an additional fee for completing the stamp duty form.

wowfudge · 02/12/2018 16:59

That's not clear of me: if you solicitor sorts out the stamp duty for you, they may charge you additional fees.

LondonMischief · 02/12/2018 18:55

You would have had to declare the purchase price to your mortgage lender and would be on your mortgage offer, So this should have been £390k. Stamp duty would have been £9500.

MovingNextYearHopefully · 03/12/2018 01:01

We're buying a new build. Paying 615k, getting just over 15k of stamp duty paid, plus all flooring worth around 5k. We are still paying 615k for the house regardless & it will show as the sold price. In reality they're getting just under 600k from us & doing the flooring for free, but it looks to people viewing sold house prices online that we paid 615k.

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