Anthony Smyth and Michael Walsh, respectively head of the tax and property departments at ByrneWallace, explain the repayment of stamp duty where land has been used for residential development.

Section 83D of the Stamp Duties Consolidation Act 1999 (inserted by section 61 of the Finance Act 2017) (“Section 83D”) applies to:

Section 83D establishes a repayment mechanism for stamp duty paid on the acquisition of land on which residential property is built (up to a maximum amount of two thirds of any such stamp duty paid), provided the following conditions are met:-

While it is not yet clear how it will be monitored or implemented, the stamp duty repayment itself will be clawed back if:

The Repayment

The amount to be repaid shall be determined by the formula:

A x B x 2/3

Where:

A = the amount of stamp duty paid (at the rate of 6%); and

B = the proportion of the area of the land on which residential development occurred, expressed as a fraction.

If the maximum amount of stamp duty is repaid under Section 83D, the effective rate of stamp duty ultimately payable would be 2%.

Making a Repayment Claim

Once construction operations have commenced pursuant to a commencement notice, a claim for a repayment can be made by electronic means (in a form and manner yet to be specified by Revenue). Each claim should:

All relevant documentation should be retained by the claimant for six years commencing on the Date of Acknowledgement, as same may be requested by Revenue to evidence the legitimacy of any such claim.

If Revenue refuses the repayment they shall notify the claimant in writing of the decision and the reasons for it, who may appeal to the Appeal Commissioners within 30 days of receipt of any such notice.

While the above relates to multi-unit single phased developments, Section 83D also applies to single-unit developments and multi-phased developments with the conditions set out above modified accordingly.