Rental Stamp Duty

Michael D Not Higgins

I was struck recently by a thread where someone was paying 3k per month rent and remembered reading somewhere that stamp duty is due on rent if it goes over a certain level, so I went digging.

€2500 per month.
http://www.thejournal.ie/stamp-duty-renting-3472330-Jul2017/

In today's rental crisis, it is easy for many people to be in houseshare situations where the total rent tops 2.5k and no one would be any the wiser about stamp duty. I'm not sure how it's enforced and it certainly wasn't envisaged at the time the limits were set to affect the numbers that it could today.

At 1%, it's only a small amount more but it's another bill nonetheless. As per the Journal article above, the number has grown by 3 times in 3 years but it doesn't say how they enforce this.

As a sample, of 1097 properties on Daft to rent in Dublin, 433 (about 40%) are 2500 and above per month. Also, you could end up renting a room in a shared place and not even know the total rent is above the limit.

mrslancaster

I wondered when the rental stamp duty is paid and what the procedure is?

would the tenant have to pay it when they sign the lease & do they pay it directly to revenue, the landlord or the estate agent

my experience of stamp duty is when we bought our house & paid stamp duty to the solicitor, AFAIK that's the norm when buying a house.

interested in what happens for rent situation

Is there a single person in the country paying the stamp duty in a long term rental? I would bet there isn't. Sure the vast majority have never even heard it's due.

Michael D Not Higgins

Graham Melted Painting wrote: »

Is there a single person in the country paying the stamp duty in a long term rental? I would bet there isn't. Sure the vast majority have never even heard it's due.

If you read the link I posted there's only 238 last year paying it, but that's up from 80 three years previously. Considering the number of advertised properties on Daft above 2500/month, it would seem enforcement and compliance is pretty low amongst those who do owe it.

Michael D Not Higgins

Michael D Not Higgins wrote: »

If you read the link I posted there's only 238 last year paying it, but that's up from 80 three years previously. Considering the number of advertised properties on Daft above 2500/month, it would seem enforcement and compliance is pretty low amongst those who do owe it.

I'm even surprised that many are paying it, if for no other reason that they don't know about it. I'd consider myself more knowledgeable than the average person on the workings of property rental etc and I'd never heard of it until it was mentioned on another thread recently.

Michael D Not Higgins

Graham Melted Painting wrote: »

I'm even surprised that many are paying it, if for no other reason that they don't know about it. I'd consider myself more knowledgeable than the average person on the workings of property rental etc and I'd never heard of it until it was mentioned on another thread recently.

I came across it on a citizen's information page a few years ago and laughed at the day we'd have to worry about rents above 2500 for the average property.

mrslancaster

Curiosity got the better of me...

the revenue website lists a lot of things that are liable for stamp duty and I thought it was just buying a house

http://www.revenue.ie/en/property/stamp-duty/working-out-your-stamp-duty/current-rates-of-stamp-duty.aspx

davindub

Michael D Not Higgins wrote: »

Graham Melted Painting wrote: »

I'm even surprised that many are paying it, if for no other reason that they don't know about it. I'd consider myself more knowledgeable than the average person on the workings of property rental etc and I'd never heard of it until it was mentioned on another thread recently.

I came across it on a citizen's information page a few years ago and laughed at the day we'd have to worry about rents above 2500 for the average property.

It was about 19k in 2007 so there were a lot of rents above this then. Threshold petitioned a lot to get it raised. I don't think revenue intend to catch most rents just higher ones. Offhand the highest stamp on leases is 12% for over 100 years.

Graham

mrslancaster wrote: »

I wondered when the rental stamp duty is paid and what the procedure is?

would the tenant have to pay it when they sign the lease & do they pay it directly to revenue, the landlord or the estate agent

The letting agent would usually look for the stamp duty at the signing of the lease/hand-over of the deposit.

Most letting agents are so particular about it that I wouldn't be surprised to discover the landlord was potentially liable if the stamp duty wasn't paid.

Marcusm

Michael D Not Higgins wrote: »

I came across it on a citizen's information page a few years ago and laughed at the day we'd have to worry about rents above 2500 for the average property.

If the lease is subject to stamp but the stamp is unpaid then it would be difficult to enforce the terms through RTB or the courts as an unstamped document cannot be adduced as evidence. No lease/tenancy, no recourse.

Michael D Not Higgins

Marcusm wrote: »

If the lease is subject to stamp but the stamp is unpaid then it would be difficult to enforce the terms through RTB or the courts as an unstamped document cannot be adduced as evidence. No lease/tenancy, no recourse.

Interesting point, I await the first RTB case to be decided by such.

Claw Hammer

I was at an adjudication when an unstamped lease was produced. The parties agreed that the document embodied the terms of the agreement so the adjudication proceeded on that basis. It might have been different if one party had denied the lease.
Tenent's who don't pay their stamp duty are tax cheats yet there is no clamour to go after them unlike landlords who are constantly hounded for tax.