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Home Part Exchange

Is there a law in the UK stopping you to sell your house at a low price. For example if I do a part exchange with a builder to buy a newly-built house. THe only thing the builder is interested in the money is going to get, i.e. the difference between the new house and the price of my own. So let's say that the builder says I need 200K. Obviously you can get that difference by buying a house at 400K and selling your at 200K but you get the same difference with buyng at

300K and selling at 100K. However, the stamp duty you're going to pay will be a lot less in the second case.

Is that somehting you can do without problem or is there a limit to how low you can set the price of the houses?

Hope it's clear enough...

Thanks

Reply to
David Perrault
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I believe there's nothing to stop you doing a swap with one party paying the difference in value, and the stamp duty will be quite properly assessed simply on that difference. I swapped houses with a neighbour a couple of years ago; my solicitor suggested that we do this, and the other party's solicitor was quite happy with it.

Matti

Reply to
Matti Lamprhey

No, but if you're not living it it, you're still liable to capital gains tax at its full value, regardless of whether you sell at a lower one.

In that case, it shouldn't be an issue.

Interesting point. Of course, you'd be better off buying at 249,950, to get the lower rate of stamp duty. I've a nasty suspicion that you might get into trouble over under-declaring value for stamp duty purposes, though.

Check out the Inland Revenue Stamp Duty website () to see if that's going to be a problem. You can also call them anonymously, and sound them out as to whether you could get in difficulties.

Jon

Reply to
Jon S Green

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