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Stamp Duty Explained

Stamp Duty is the tax levied by the Government for changing the documents that specify who owns a particular property irrespective of whether it’s a new build or second-hand property.  It’s thought to have originated in Spain and goes back to the days when a physical stamp (a revenue stamp) had to be attached to a document to show that duty had been paid.

How much is Stamp Duty?

The amount is based on the type and cost of the property and whether it is a residential or non-residential property.

For residential property, it is calculated at 1% of the selling price of any property up to €1m. For amounts above €1m you will be charged 2%.

For example:

If you buy a home that is worth €300,000, you will pay stamp duty of €3,000.

It is worth noting that stamp duty is not part of your mortgage and needs to be saved separately to what you have for your deposit.

Buying a New Build?

VAT is charged on new build homes but not on second-hand homes.

If you are buying a new build, then you will only pay Stamp Duty on the base price. Not the price including VAT.

For example:

If you paid €227,000 (including VAT) for your new house, this is made up of the base price of €200,000 plus 13.5% VAT (€27,000).

In this case you only pay stamp duty on the base price of €200,000, so your Stamp Duty will be €2,000.

Who do I pay my Stamp Duty to?

When closing a sale your solicitor will calculate the stamp duty you owe to the Revenue Commissioners.

Non-residential property?

A single rate of 2% applies to all non-residential property.

Buying a site?

If you buy a site with an arrangement to build a house on it, then stamp duty will be charged at the residential rate on the total of the site and the building cost.

If you buy a site with no connected arrangement to build a house or apartment on it, then stamp duty will be charged on the site cost at the non-residential property rate.

For more information check out the Revenue Commissioners page on Stamp Duty.

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