Stamp Duty
This is a small tax paid on all contract documents, the exact amount relating
to the price of the property. Stamp duty is technically a tax on the transfer
of any valuable rights so it is also payable on share transfers and various insurance
policy documents. It is also payable on any tenancy agreements which are subject
to court action.
Stamp duty on house purchase has recently been restructured
by the 2000 Budget and called Stamp Duty Land Tax to differentiate it from other
forms of Stamp Duty. It is likely to be reviewed regularly as it is an apparently
simple form of taxation on the ownership of more expensive property and one the
Exchequer will not easily relinquish.
If your purchase falls within the
band where stamp duty is payable, there is no way to avoid such payment. It may
be possible to adjust the proportion of a sale price allocated to fittings and
extras. This could be of some help at the margin where a tax band increases in
a large step but bear in mind the Inland Revenue has recently set up a team of
investigators to look into these marginal transactions and any over-valuation
of the extras can result in prosecution for tax evasion. Look at it as a small
price to pay for all the privileges and advantages of owning a home of your own!
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