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bigduckontax
bigduckontax, Accountant
Category: Tax
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I have a query about Stamp Duty Assistant: Thank you. Can

Customer Question

I have a query about Stamp Duty
Assistant: Thank you. Can you provide any more details to help us find you the right Expert?
Customer: Yes, I would be very grateful for some help!
Submitted: 7 months ago.
Category: Tax
Expert:  bigduckontax replied 7 months ago.

Hello, I am Keith, one of the experts on Just Answer, and pleased to be able to help you with your question.

What is you problem exactly?

bigduckontax, Accountant
Category: Tax
Satisfied Customers: 3605
Experience: FCCA FCMA CGMA ACIS
bigduckontax and 2 other Tax Specialists are ready to help you
Customer: replied 7 months ago.
I own 2/7ths of the value of my parents' house and I am named on the deeds. Both my parents have died now and I am in the process of buying out my siblings to gain 100% ownership of the house. It will be my only residence and I will not have a mortgage.My question regards ***** ***** of stamp duty I must pay on the purchase. Presumably, I don't pay stamp duty on the percentage of the house I already own (I've owned it since 1989) but do I owe it for the quarter share I will inherit under my mother's will? Also, one of my brothers has very kindly offered to gift me his share from my mother's will (which I am going to pass on to his children). If he is giving me this money as a gift, does this count as part of the purchase price of the house, and is therefore liable for Stamp Duty?.
I've checked the amount of Stamp Duty payable and there is a huge discrepancy between a purchase price of £358K (The agreed purchase price, minus my share from my mother) and £251K the agreed purchase price minus my share and my brother's share.
Any advice gratefully received!
Thanks!
Jo
Expert:  bigduckontax replied 7 months ago.

I am on 01750 725420

Expert:  bigduckontax replied 7 months ago.

From tax Insider:

'However, similarly to Stamp Duty, SDLT is charged on ‘money or monies worth’ and what counts as ‘chargeable consideration’ is defined very widely to include consideration given directly by the purchaser, or person connected with the purchaser, i.e. the purchase price plus any additional amounts paid in the transaction towards the Seller's fees, for example, plus any VAT chargeable.'

Expert:  bigduckontax replied 7 months ago.

From the Gov UK Web site:

'You don’t pay Stamp Duty, Income Tax or Capital Gains Tax on a property you inherit when you inherit it.'

So the SDLT will be limited to the chunk your brother is kindly gifting you.

This gift will create a Potentially Exempt Transfer (PET) in his Inheritance Tax (IHT) affairs. PETs run off at a taper over seven years and in the event of his demise within that period are added back to his estate for IHT purposes. PETs are the first to suffer IHT and if the deceased's estate is insufficient to meet the IHT on the PET the liability cascades down to the beneficiary for immediate settlement. The classic defence against tax on a PET is a reducing term life insurance policy.

Expert:  bigduckontax replied 7 months ago.

Thank you for your support.

Customer: replied 7 months ago.
Thank you so much for clarifying this matter for me. I can now go ahead with confidence!
Expert:  bigduckontax replied 7 months ago.

Delighted to have been of assistance.

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