Tim-Grove

Illegal????

Playsatan

iTrader: (2)

How much cash?

If it's borderline get you lawyer to draw up the contract for £xxx (obviously under the limit) for the house and £xxx for the fixtures and fittings.

Tim-Grove

looking at a 130k house. wondered if i paid 124,995 for the house and like 5k for a tea cup or somthing

Luminous

iTrader: (3)

There is some clause that is meant to stop you from doing this. The old buy the house and give them some more money for something inside it is meant to be long gone.

I believe you need to create the image of two entirely unrelated transactions. One for the house and another totally unrelated transaction for something else. Hopefully you will get some more specific advice, on both what the true legal position is, and also on what the practical workarounds are currently.

I think the real problem you will run into is getting the people you are buying from to agree to it. Basically you are going to have to get them to agree to sell the house for less than its worth. The second separate transaction cannot be based on the sale of the house, so at some point someone is going to have to trust someone else. Its not like you can bung them some cash in front of a solicitor, not a straight one anyway.

Sonic'

Ask to 'buy their car' as well

Playsatan

iTrader: (2)

It was a couple of years ago but we did it with no problems, They had a bloody expensive cooker, fridge freezer and dishwasher that weren't in with the price of the house. If you know what I mean.

Longjing

As above... legitimate allocation of some of the price to fixtures and fittings is fine. Push it to the extent that you are demonstrably distorting the value of the land element and that's fraud on HM Revenue & Customs, technically. Fraud is indeed illegal.

The main issue is getting it past everyone involved in the transaction. If any of the lawyers involved thinks you're acting illegally, they may object, or worse, if they're your lawyer they may think about their own legal obligation, punishable by criminal sanctions, to report suspicious transactions or transactions involving the proceeds of crime (ie the fraud) to NCIS. That seems quite unlikely to be honest but it does happen. And if they do report they are also prevented by law from telling you about it.

I'd have thought you could find £5k of fixtures though.

paulr

Yes.

daddyscoob

Things are only illeagal if you get caught. Worked fine for me and I've only been arrested twice in 45 yrs... not bad

Jay m A

iTrader: (2)

If its on for 130k they are expecting and will accept offers £1 under the threshold, and I'm sure carpets won't be included etc

Tim-Grove

looks like its worth a try then

fast bloke

The stamp duty is only 1300 quid, so the solicitors/revenue wont be too interested. When you get a 600k house going for 499 and 101k for curtain poles then they tend to look into it a little more

MattN

As above.

The fixture's and fittings are anything that would not be unreasonable to take with them, I.e. white goods, curtains, possibly carpets etc.

I tried this but my solicitor advised we needed to get 12.5k worth of fixtures which is unlikley, so we had to stump up the extra 2% duty.

The Snug Rhino

bit like saying falling from a plane is only painful if you land awkward.

Hanley

RussBoy

I've heard of one friend of mine getting a letter from HMRC asking more 'details' about the purchase of a property at £249,995. HMRC were evidentally very nice about it and said they do this from time to time.

Here in Spain it's common place to 'under declare' and get a briefcase full of money under the table....


R

Coffin Dodger

Feckin stamp duty Really pisses me off.

Why can't it be 3% just on the bit over £250K not the entire feckin value of the house. Barst*d Labour.

OK I know the Tories are probably to blame for it in the first place but there is nothing to stop Gordon Brown from changing the rules (expect the £££ he'd lose).

BTW looking for a house at the moment around £250k

hades

Generally, you can exclude anything that isn't actually part of the property (per the title deeds) from the sale and make it a separate transaction. That can include carpets, curtains, white goods, garden shed, furniture etc. It can't include parts of the house, land, etc. Whilst there is no law saying you can't get a good deal on the house and a poor deal on the fixtures and fittings, you have to be able to justify any deal you do as reasonable. I'd suggest that anything over an advertised price for identical/equivalent new goods from a normal retailer for the carpets / white goods / whatever would not be reasonable, whereas equal to or less than that price would be OK.

Different solicitors apply the details differently, but any straight one will have some way of trying to make sure it's legal and not defrauding HM revenues & customs (or whatever they call themselves these days). My first ever house years ago, they ran on the basis of max 2.5% of the total value could be F&F, I've also heard of e.g. £5k as a cap unless you can prove exceptional circumstances.

Longjing

The first Stamp Act was in 1765... I think it was the Whigs rather than the Tories.

The problem is the rise in house prices really.

wilfthree

Yes its illegal. It doesnt matter what you put in the documents either - as SDLT is a self assessed tax.

Whether or not HMRC spot it though is another matter. Though if your lawyer was aware of your intention then he would have a duty to report you to the NCIS.

- Oh yes - Fixtures and fittings apportionment works if the price paid for them is genuine.

TopBanana

If in doubt, and it's a tax, labour probably did it.

And the 'first place' argument doesn't hold. Government reviews taxation every year. Brown should have increased the thresholds in line with house price inflation, but it's another of his sneaky cynical stealth taxes.

carl

Central heating counts as a fixture or fitting

Longjing

I'm not in favour of Gordon, but that's a misplaced attack. He raised the 60k band to 125k after all.

I've got an image of Ken Clarke thinking up a clever way to raise taxes but saying to himself "No! We are Tories. I must explain my revenue raising plans in plain english".

They're all politicians And in a country where the Sun decides who gets elected, truth and common sense play only a small part.