Róisín Shortall (Dublin North West, Labour)
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Question 105: To ask the Tánaiste and Minister for Finance if the proposals contained in budget 2008 relating to the claw-back of stamp duty by first time buyers who cease to be owner-occupiers within two years of claiming relief or exemption for first-time buyers applies to first-time buyers who rented out their property before budget day; if a back dating of the proposal will be applied; the way a first time buyer who rents their property who availed of a lower stamp duty rate as opposed to a total exemption is treated if they have rented their property before the applicable cut-off date; and if he will make a statement on the matter. [34776/07]

Brian Cowen (Laois-Offaly, Fianna Fail)
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First-time buyers are treated favourably under the stamp duty code in recognition of the special circumstances of persons purchasing their first home. Preferential rates and thresholds were afforded to first-time buyers up until the Finance (No. 2) Act 2007, which introduced a full exemption from stamp duty for first-time buyers on the purchase of new or second-hand dwelling houses or apartments. There is also a full exemption available for other owner-occupying purchasers of new dwelling houses or apartments under 125m2. In addition, partial relief is also available to owner-occupying purchasers of new dwelling houses or apartments over 125m2.

In order to restrict these three stamp duty reliefs to persons who reside in the property, purchasers were required to declare that they will reside in the property for a defined period of five years. Where any rent is derived from the property concerned before the expiration of this period, other than under the rent-a-room scheme, the stamp duty relief was clawed back. This claw-back period was reduced from five to two years from Budget day. This change applied to persons who purchased property from Budget day and for those persons who had purchased before this time but had not let out their property. There is no back-dating of this provision.

Where first-time buyer's relief is clawed-back, the purchaser is liable to stamp duty at the normal rates that would have been liable at the time of purchase. In this respect, where a person received a full exemption from stamp duty under the current rules, they would be liable to pay the full amount. However, where a person paid a reduced level of stamp duty the claw-back would only be chargeable on the difference between the amount that was paid and the amount that should have been paid at the time.