Is buying chattels a legal way to lower stamp duty costs?

Our lawyer Fiona McNulty explains stamp duty thresholds and the practice of paying for chattels to lower the asking price of a property
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Question: My son is buying his first flat — for £410,000 — and having recently got divorced I’m buying my first home in my own name.

I am paying £2.05 million for a place in Fulham. The agents in both cases are being very vague about stamp duty and mine says I should pay some of the purchase price for “chattels”, presumably to lower the asking price below £2 million. We both need to budget, so what’s going on? And will we get a stamp duty discount as first-time buyers?

Answer: For a start, neither of you is entitled to any stamp duty exemptions as first-time buyers. You are probably thinking about help that was available to first-time buyers from March 25, 2010 to March 24 this year where the amount paid for a property was below £250,000. That’s now over.

Your son will pay three per cent of the purchase price (£12,300) in stamp duty, as the cost of his flat is in the band between £250,000 and £500,000. You will pay seven per cent of the purchase price (£143,500) as the price of the property you are buying is more than £2 million.

The estate agent is suggesting a payment for chattels so the price for the property is below £2 million and would thus fall within the lower band of over £1 million to £2 million, which then attracts stamp duty of only five per cent. HM Revenue and Customs deals with the payment of stamp duty and may very well scrutinise a transaction such as yours, which is borderline.

I would recommend you only do as your estate agent suggests if a detailed inventory can be prepared showing the true value of the chattels, which is accepted and agreed by the seller and annexed to the contract.

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If you have a question for Fiona McNulty, email We regret that questions cannot be answered individually.

Fiona is a partner in the residential real estate team at Thring LLP

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