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Buying second house but keeping first

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    #32
    athlone573
    Registered Users Posts: 724 ✭✭✭athlone573


    The banks have quotas for "normal" loans and for exceptions. I believe their quotas fill up mid way through the year. Your broker should know the details.


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    #33
    athlone573
    Registered Users Posts: 724 ✭✭✭athlone573


    AndrewJRenko wrote: »
    It's very hard to hide real life activity. If you want to rent out one or other property, this becomes very obvious through income or RTB or complaint from tenant. If you want to claim that a mostly empty property is actually your PPR, utility bills will show that it was mostly empty.



    No restriction on transferring afaik. I though the suggestion was to lie to Revenue about the PPR.


    The worst thing would be to get the mortgage, end up in a default situation a few years down the road, and have your bad faith mortgage application played out in Court when you're trying to hold on to the property.

    The worser thing would be to be criminally prosecuted for lying on your mortgage application.

    I'm not being a holy joe but it has happened.


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    #34
    duffysfarm
    Registered Users Posts: 848 ✭✭✭duffysfarm


    I dont understand the chat re ppr.

    If you are working in dublin and have a house in dublin and a house many miles away in the west of ireland then it is clear which house is the ppr. Common sense would dictate which house is ppr
    Also electricity bills would be used to prove where the majority of time was spent for living time.


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    #35
    Brego888
    Registered Users Posts: 1,321 ✭✭✭Brego888


    Claw Hammer wrote: »
    Not correct. When the property is sold the gains are apportioned over the entire period of ownership. if you bough 4 years ago and sell after another 6, 50% of the gain is taxable, irrespective of when it occurred. the house could decline in value from the time of moving out and you could end up having to pay CGT.

    Where are you getting 50% from? CGT is calculated at 33% of the gain. And you only pay for the proportion that it was not principle residence.
    If the gain was for example 100k over this 10 year period, having been non pppr for say 6 years the CGT would be 33% of 60k. Which would be 18k.


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    #36
    The J Stands for Jay
    Registered Users Posts: 5,765 ✭✭✭The J Stands for Jay


    Claw Hammer wrote: »
    Not correct. When the property is sold the gains are apportioned over the entire period of ownership. if you bough 4 years ago and sell after another 6, 50% of the gain is taxable, irrespective of when it occurred. the house could decline in value from the time of moving out and you could end up having to pay CGT.

    I got some notion in my head that you could value it on the date you moved out and present that to Revenue. It'd be worth a try anyway ;)


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    #37
    wench
    Registered Users Posts: 1,644 ✭✭✭wench


    Brego888 wrote: »
    Where are you getting 50% from? CGT is calculated at 33% of the gain. And you only pay for the proportion that it was not principle residence.
    If the gain was for example 100k over this 10 year period, having been non pppr for say 6 years the CGT would be 33% of 60k. Which would be 18k.
    You get 12 month's grace from when you move out.
    Hence 5 years ppr giving 50% of the gain subject to tax.


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    #38
    wench
    Registered Users Posts: 1,644 ✭✭✭wench


    McGaggs wrote: »
    I got some notion in my head that you could value it on the date you moved out and present that to Revenue. It'd be worth a try anyway ;)
    You'd just be wasting the money you spend on it, Revenue don't care about the interim value.


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    #39
    Claw Hammer
    Registered Users Posts: 6,236 ✭✭✭Claw Hammer


    Brego888 wrote: »
    Where are you getting 50% from? CGT is calculated at 33% of the gain. And you only pay for the proportion that it was not principle residence.
    If the gain was for example 100k over this 10 year period, having been non pppr for say 6 years the CGT would be 33% of 60k. Which would be 18k.

    Where are you getting 60k from. The last year counts as PPR whether it was the PPR or not thus 4 years occupied and 6 years let means it is deemed to be a PPR for 5 of the 10 years.
    The tax man must love you paying in more than you have to!


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    #40
    javaboy
    Registered Users Posts: 15,094 ✭✭✭✭javaboy


    wench wrote: »
    You'd just be wasting the money you spend on it, Revenue don't care about the interim value.

    Wonder if there's a low friction, low cost way to sell the property to yourself to lock in the non-taxable gains if you don't expect much movement in price in the coming years while it's not your PPR.


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    #41
    Claw Hammer
    Registered Users Posts: 6,236 ✭✭✭Claw Hammer


    McGaggs wrote: »
    I got some notion in my head that you could value it on the date you moved out and present that to Revenue. It'd be worth a try anyway ;)

    It is a self assessed tax. Get it wrong and find yourself stuck with interest and penalties. Not worth "a try".


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    #42
    AngryLips
    Registered Users Posts: 2,703 ✭✭✭AngryLips


    Everyone is coming down very hard on the broker here. They sound like they're only doing their job, and that's highlighting opportunities for the client to get what they want within the existing rules - and I would say they're doing a good job with the advice given. I mean it sounds like there's scope for OP's partner to live there on a permanent basis, ultimately it's the OP+partner who will need to decide if they want to live that way or to represent themselves in that light on the application even if they choose not to live that way. Ultimately, the lie is inconsequential if both options result in a fully paid up second home.


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    #43
    [Deleted User]
    Posts: 14,344 ✭✭✭✭ [Deleted User]


    I would have to agree with some of the posters in that the broker is doing a decent job, if he's highlighting ways in which you can benefit from different rules/situations.

    You went to a broker with the aim of getting a mortgage across the line, and the broker has pointed out ways in which you can do it. Switching broker would be foolish in my opinion.

    Besides, what's to say you aren't planning to live there, but something changes upon drawdown and all of a sudden you're stuck in Dublin. Your broker seems good, to me.


    SupaCat95 wrote: »
    with our new Covid lifestyles

    Rolled my eyes so hard I nearly hurt myself.


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    #44
    GerardKeating
    Registered Users Posts: 7,650 ✭✭✭GerardKeating


    phd wrote: »
    This is exactly my reservation

    but is/was it a lie. What do you plan to do with the second house, it purely a buy to let, then yes, it's a lie.

    But if you have long term plans to migrate to the west, then it's not a lie.


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    #45
    GerardKeating
    Registered Users Posts: 7,650 ✭✭✭GerardKeating


    Ace2007 wrote: »
    How do revenue know which is your PPR though? If they kept their Dublin address in revenue files etc
    Claw Hammer wrote: »
    Not correct. When the property is sold the gains are apportioned over the entire period of ownership. if you bough 4 years ago and sell after another 6, 50% of the gain is taxable, irrespective of when it occurred. the house could decline in value from the time of moving out and you could end up having to pay CGT.

    Can a husband and wife have differnt PPR's ?


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    #46
    [Deleted User]
    Posts: 14,344 ✭✭✭✭ [Deleted User]


    athlone573 wrote: »
    The worser thing would be to be criminally prosecuted for lying on your mortgage application.

    I'm not being a holy joe but it has happened.




    When has that ever happened? :confused:


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    #47
    Claw Hammer
    Registered Users Posts: 6,236 ✭✭✭Claw Hammer


    Deleted User wrote: »
    When has that ever happened? :confused:

    https://www.breakingnews.ie/ireland/man-jailed-for-using-fake-documents-in-mortgage-application-1075213.html

    https://www.irishexaminer.com/news/arid-30920295.html


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    #48
    AngryLips
    Registered Users Posts: 2,703 ✭✭✭AngryLips


    Claw Hammer wrote: »
    https://www.breakingnews.ie/ireland/man-jailed-for-using-fake-documents-in-mortgage-application-1075213.html

    https://www.irishexaminer.com/news/arid-30920295.html


    This example refers to providing third-party documents that have been falsified.


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    #49
    runawaybishop
    Registered Users Posts: 9,504 ✭✭✭runawaybishop


    Ace2007 wrote: »
    Ok so if you didn’t mention that it was your PPR on the mortgage how would they know? Or if you were a cash buyer.

    If you split your time between two properties and state that Dublin property is your PPR how can the disprove it? If you have family with kids and they are living/ going school etc in other country obv you can’t get round that - but single or couple who works in dublin - could easily be splitting time.

    This revenue you are talking about here, they don't need to prove anything, they will fall down on whatever side means you pay more to them and it's up to you to prove otherwise.


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