In January 2022, Company B purchased 10 houses for €4 million and paid stamp duty of €400,000. In February 2022 Company B leased one of the houses to an Approved Housing Body for social housing purposes. The cost of the leased property was €300,000 and the term of the lease is 25 years.
Company B is due a partial refund.
Stamp Duty paid on the leased house at 10% rate = €30,000 (€300,000 @ 10%).
Stamp Duty payable at the standard rate on the 10 properties = €70,000 ((€1m x1%) + (€3m x 2%)).
Stamp Duty attributable to the leased property at the standard rate = €5,250 (€70,000 x (€300,000 ÷ €4m)).
The refund, using the formula A – B is calculated as follows:
€30,000 - €5,250 = 24,750.