Stamp Duty Refund for Redevelopment - MW Keller & Son Solicitors LLP

*This article was amended in September 2022 to reflect changes in the scheme as per Budget 2023.

Since the 11th of October 2017, the stamp duty refund rate for non-residential property increased from 2% to 6%. This rate further increased to 7.5% since the 9th of October 2019.

A scheme introduced by Revenue allows the potential for a refund of a portion of stamp duty paid where the rate of 6% or 7.5% was charged. The refund amount will be for the difference of the previous rate at 2% and the rate of 6% or 7.5% (whichever applied at the time of the transfer). This would allow for a substantial refund on the stamp duty paid.

How to Qualify for a Stamp Duty Refund

To qualify for this refund, the non-residential property must be redeveloped by developers which include builders constructing multiple houses and individuals building a one-off property for themselves.

The building of any property/properties whereby builders are trying to avail of the scheme must commence before the 31st December 2022 and a period of 30 months is allowed for the completion of these developments.

In order to qualify for the above scheme, the stamp duty return must be filed and stamp duty must have been paid at a rate of 6% or 7.5% as applicable. Furthermore, construction must complete within a period of 30 months and this timeframe runs from the day after the deed is stamped. Some of the activities that would satisfy the definition of construction for the purposes of this scheme include demolition of existing buildings, access works, laying foundations and clearing a site.

Housing Units Test

As stated above, the completion of works must complete within 30 months of the commencement and this is measured by reference to a local authority acknowledging receipt of a commencement notice or a seven-day notice. The completion of a property will be determined by the date a Certificate of Compliance on Completion is registered by the local authority.

It is important to note that a test also applies to this scheme where either 75% of the total surface area of the land must be occupied by housing units or the gross floor space of the housing units must account for at least 75% of the total surface area of the land.

Consanguinity Relief

The rate of stamp duty on property other than residential is 7.5%. In an attempt to ease the financial burden of transfers within farming families this rate was reduced to 1% specifically for such transfers.

The relief was due to expire in December 2020 but Budget 2021 extended this relief to 31st December 2023, and indeed Budget 2022 further extended this relief until the 31st of December 2025.

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