Question: I am interested in buying a property that is on the market for £185,000. The estate agent has suggested that I offer £175,000, with an additional £10,000 for fixtures and fittings to save stamp duty.
© Merrily Harpur
My solicitor says I cannot do this. Who is correct?
Answer: The sale of chattels, which are moveable items and therefore not fixtures, does not attract stamp duty. Fixtures are such things as fitted wardrobes.
Paying for fixtures and fittings separately is common practice where the value of the property or land and the chattels is just above one of the stamp duty thresholds, such as in your case.
The value of any chattels must not be over-inflated as this may amount to a fraud on HM Revenue & Customs, for which you and your solicitor could face criminal charges and any deal you struck in an attempt to cheat the taxman would be unenforceable.
The seller should provide a Form TA10, which is the fittings and contents form, and it is good practice for a copy of this to be attached to the contract. Any chattels for which you are paying extra in addition to the price of the property should be itemised and priced separately.
This list should also be annexed to the contract and the price to be paid for the chattels clearly shown. If you can truly show that the value of the fixtures and fittings is £10,000, then your solicitor will be able to agree to buy them separately from the seller’s solicitor. However, if you cannot do so, then your solicitor is quite right in advising you against such a deal.
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If you have a question for Fiona McNulty, email email@example.com. We regret that questions cannot be answered individually.
Fiona is a partner in the property team at Thring Townsend Lee & Pembertons Solicitors www.ttuk.com.