Tax Relief on the purchase of Land for Newly Built Houses

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Stamp Duty is a tax payable to the Revenue Commissioners on the transfer of all property and land. In the case of land, without buildings on it, the stamp duty is charged at 7.5% of the market value of the land.  For example, one acre of land worth €100,000 would result in a tax bill of €7,500 stamp duty payable to the Revenue Commissioners. This tax is payable even if the land is transferred to you for free (for example by your parents).  This is a sizeable bite out of anyone’s budget, before you have even turned the first sod.

However, you can apply for a refund of some of this stamp duty (eleven-fifteenths to be precise – so in the above example you would get a refund of €5,500). You may only claim a refund on land transferred to you up to a maximum of one acre.

To claim the transfer you must:

  1. Pay the full 7.5% stamp duty due and obtain a stamp duty certificate (your solicitor will do this for you).
  2. You must start building within 30 months of the transfer of the land to you.
  3. You must make your claim electronically after you have commenced the building work. You will need to submit a commencement notice to the county council and this will have to be accepted by them as valid.
  4. You must commence building before the 31st of December 2021.
  5. You must claim the refund within four years of when the county council acknowledge receipt of your commencement notice (however the build must be completed within two years)

You must complete the build within two years of the county council acknowledging your commencement notice, otherwise the Revenue Commissioners will “claw back” the refund. The work will be deemed completed once your house has been connected to the ESB – there is a specific certificate that your electrician will furnish in this regard. (However, if you opt into the new Building Control regulations, there is an alternative form called a Certificate of Compliance on Completion that your engineer will provide you with).

If you are in a position to avail of this relief, you will be paying 2% stamp duty instead of 7.5%, which is always good news!

We can assist you with the land transfer and obtaining the Stamp Certificate. Please contact us for more information.

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