Revenue ordered to refund a taxpayer over €43,000 in stamp duty

An appeals commissioner found that the correct amount of stamp duty payable by the taxpayer on the deed of transfer of one quarter of the €6m property is €11,777 and that the assessment of €55,723 issued by Revenue in 2008 was incorrect. Picture: Laura Hutton/RollingNews.ie

The Tax Appeals Commission (TAC) has ordered that Revenue refund a taxpayer €43,496 in stamp duty from a property transfer involving a €6m property.

This follows the appeals commissioner Clare O’Driscoll finding that the correct amount of stamp duty payable by the taxpayer on the deed of transfer of one quarter of the €6m property is €11,777.

Ms O’Driscoll found that Revenue’s stamp duty assessment issued to the taxpayer of €55,723 in 2008 was incorrect.

In this case, the man and his father purchased lands consisting of five plots of registered and unregistered lands as tenants in common in 2006.

In 2008, the appellant’s father executed a deed of transfer in favour of the appellant whereby he transferred a one-quarter share of the property to his son.

The effect of the deed of transfer was that the appellant held a three-quarter share of the property and the appellant’s father held a one-quarter share.

In 2008, the properties were worth €6m and the father and son had a joint mortgage debt of €4.95m on the property.

As a result, the solicitor for the appellant estimated that the equity of redemption on the property was €1.04m and the one quarter transferred had an equity value of €261,705.

The solicitor computed the €11,777 stamp duty liable by his client as the transaction qualified for consanguinity relief and that a stamp duty rate of €11,777 or 4.5% on the 25% share of €261,705 applied.

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At the TAC hearing, the taxpayer argued that no consideration was passed from him to his father on foot of the deed of transfer and therefore the transfer of the one-quarter share of the property to the appellant was a gift from his father.

Revenue contended that the correct stamp duty to be applied was €55,723, which allowing for consanguinity relief and a stamp duty rate of 4.5%, is based on one quarter or €1.23m of the outstanding mortgage debt of €4.95m.

Ms O’Driscoll found that Revenue was incorrect to issue the €55,723 assessment after finding that the deed of transfer did not result in the appellant assuming an additional one quarter of the outstanding mortgage debt.

Ms O’Driscoll also found that the deed of transfer did not affect the joint liability of the appellant and his father for the mortgage debt in relation to the property.