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How much Tax, KVD etc on a new build?

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Happy Hussar


Joined: 01/10/2008
Posts: 318

Message Posted:
24/01/2011 22:02

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Message 1 of 10 in Discussion

A friend has been asked to pay 15,000 stg by her 'Solicitor' to secure her Kocan. The purchase price of the property was 95,000stg.



Anyone know if that would be about right? it seems a lot to me!



Tony



cronos


Joined: 26/10/2008
Posts: 2093

Message Posted:
24/01/2011 22:08

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Message 2 of 10 in Discussion

I'm confused.



Are you saying that the 15K represents tax,KDV etc or is this just a figure the builder is trying to bribe out of your friend before he hands over the kocan?



BillBarnacle


Joined: 20/04/2009
Posts: 167

Message Posted:
24/01/2011 22:30

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Message 3 of 10 in Discussion

Way over the top find a new lawyer



or insist lawyer itemises the costs



Happy Hussar


Joined: 01/10/2008
Posts: 318

Message Posted:
24/01/2011 22:32

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Message 4 of 10 in Discussion

It's the total amount the Solicitor has come up with, it includes Purchase tax, KVD Stamp duty etc.



She has received her PTP and now is working on getting the Kocan. The Solicitor is doing all the chasing and has presented my friend with this breakdown. Is it normal to pay 15,000 on top of 95.000 purchase price?



cronos


Joined: 26/10/2008
Posts: 2093

Message Posted:
24/01/2011 22:33

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Message 5 of 10 in Discussion

If you break it down for us here then people may advise whether the individual amounts look right based on the 95K purchase price.



Jonesy299


Joined: 07/02/2009
Posts: 367

Message Posted:
24/01/2011 22:38

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Message 6 of 10 in Discussion

This looks like you are also paying your builder's costs (i.e. he has to pay tax too). Around 10k should be your costs. Have another look at the contract (I would be very suprised if it doesn't state the vendor's requirement to pay his tax).



Timing of the payment is useful - ask your solicitor for the YTL/ rate they are using to calculate this cost. With the current rates you could save yourself best part of 1,000 if the rates were calculated a month ago (the exchange rate has rocketed upwards in the last few weeks!).



Hope this helps



cooper


Joined: 23/10/2007
Posts: 3386

Message Posted:
24/01/2011 23:03

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Message 7 of 10 in Discussion

At best his costs should be no more than 9k, has stated above i suspect the other 6k is to pay the vendors tax at 6.25%



Taxes here - http://www.nmplegal.com/pdf/GUIDE%20TO%20TAXES%20FOR%20PROPERTY%20TRANSACTIONS.pdf



Happy Hussar


Joined: 01/10/2008
Posts: 318

Message Posted:
25/01/2011 07:04

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Message 8 of 10 in Discussion

Thanks Guys

I will try and get the breakdown from her and post it here. It could well be the vendors tax!

Tony



tonykyte


Joined: 19/04/2008
Posts: 270

Message Posted:
25/01/2011 08:29

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Message 9 of 10 in Discussion

We are due to pay ours it is around the same figure, but included is a final payment to the builder of 5k payable when Kocan is passed across. Check if your's has a final payment if not it looks expensive. We paid our stamp duty a few years ago to take the option of the reduced rate at 0.5%, the final payment is 3% VAT ( normally 6%, but you can take a once in a lifetime option of lower VAT) and 5% Land Transfer Tax. Expect confirmation this week from our solicitor, so will let you know if it changes.



cooper


Joined: 23/10/2007
Posts: 3386

Message Posted:
25/01/2011 08:47

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Message 10 of 10 in Discussion

Tony you have the rates for Vat(kdv) and transfer tax the wrong way round, ie the vat is 5% and the transfer tax is 6% with a one of option to pay at the reduced rate of 3%.



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