What are Fixtures and Fittings?

Fixtures are considered part of the property itself. As the name suggests, they are ‘fixed’ to the property and cannot be easily moved. For example: a shower, the kitchen sink, electrical sockets, a boiler, a log burner, kitchen cupboards and worktops, would all be considered fixtures.

Fittings are objects within the property that can be moved easily. Examples of fittings include: curtains, free-standing white goods, lamp shades, paintings.

Why are they important?

The seller is not legally required to leave or take particular items when they sell their home, but they are legally required to make clear what is being left and what they are taking with them.

For clarity, most sellers will complete an inventory of the fixtures and fittings in the house stating whether they are included or excluded.  Some sellers will use their own inventory, others will complete a TA10 form (see below).

Clarity around fixtures and fittings is important in property purchases for many reasons. Firstly, some fixtures and fittings can add significantly to the value of a property and what you are willing to pay for it; put simply, you need to know what you are getting for your money. Secondly, even if the fixtures and fittings are not themselves of great value, having what is included/excluded confirmed in writing can avoid disappointment on Completion day. Whilst it might not cost a huge amount (in the scale of the property purchase) to buy new curtain rails, for example, it would still be an additional, and unexpected, cost at an inconvenient time.  

TA10 – Fittings and Contents Form

During the conveyancing process, the seller will usually complete a TA10 form. This is the Law Society’s Fittings and Contents Form (3rd Edition). It is essentially a checklist detailing the fixtures and fittings in each room of the property, and garden. In completing the form, the seller ticks either ‘Excluded’, ‘Included’, or ‘None’. In this way, there is little room for confusion in terms of what the buyer can expect to be in the property upon Completion.

This document often forms part of the contract of sale/purchase, so it is important that the seller completes this carefully, and that the buyer checks they are happy with this prior to exchange. 

Negotiation

Whilst the sellers might have a clear idea of what will be included in the sale, buyers may be able to negotiate the inclusion of specific items of interest (either as part of the sale or for an additional ‘consideration’). Some tips for negotiation include:

Negotiate face-to-face

Whilst estate agents and solicitors will want to be kept informed of anything that is agreed between seller and buyer, it is best to undertake negotiations face-to-face rather than via email with solicitors and agents.

Firstly, email negotiations can be protracted and, if it takes up a lot of solicitors’ time, could add significantly to the bill for their services. Secondly, it is easier to gauge sellers’ reactions to any requests or offers face-to-face, which helps to progress negotiations and ensure they are smooth and, ultimately, successful.

Agree to meet with the buyers (and their estate agent, if necessary) in person to discuss the inclusion of any fixtures and fittings that you are unclear about or would like to be included. If nothing else, it is a good opportunity to meet the current owners of the house- and you might find out more about the subtle nuances involved in maintaining it that you might only otherwise find out by experience!

Be approachable, clear and reasonable

Keep negotiations pleasant and good-natured, explaining why you’d like a certain fixture or fitting to add context to any offer you make. Turning your nose up at a price the seller suggests won’t go down well, and certainly won’t keep you in favour with them. Of course, you mustn’t end up paying an inordinate amount for fixtures and fittings that aren’t worth it, but be approachable and mindful of the sellers’ position, as well as their feelings about their home and its furnishings. Remember, the conveyancing process is often drawn-out and trying, so it helps to be on good terms throughout.

Keep your solicitor informed

Legally, it is important to make sure anything that is to be included in the sale is stated in the contract. This ensures buyers aren’t left disappointed when an expected fixture or fitting is missing when they finally get the keys to their new home. Having an inventory in the contract, showing the fixture or fitting was supposed to be included, can offer a buyer legal recourse through the Small Claims court in this instance. However, negotiating the price of fixtures/fittings through your solicitor can hike up their bill significantly, so it is best to negotiate and agree the inclusion of additional items face-to-face with the seller, and just have this confirmed in writing.

Use fixtures and fittings as leverage

If a seller will not come down on the price they’d accept for the property, buyers may be able to negotiate the inclusion of desirable fittings in the sale. This won’t be useful for every buyer in every situation, but it can sweeten the deal for many.

Legal Implications

If the seller states in the contract that they will include a specific fitting, they are obliged to repair or replace it if it were to break between Exchange and Completion. For this reason, some sellers prefer to officially state that they are excluding certain fittings, but rather let the buyer know their actual intentions in conversation.

So, for example, a seller might say they will leave behind 20-year-old fridge freezer on the grounds that they are getting a more efficient model for their new home and they are spared the hassle and cost of moving, selling or disposing the old one themselves. However, they may say this fitting is ‘excluded’ in the contract in case it broke between Exchange and Completion; as they haven’t legally agreed to include it, they then don’t run the risk of having to repair or replace it.  Legally, the buyer is on the backfoot here, as there is of course a risk that the sellers could change their mind for whatever reason, or it could break in the interim period. As the contract stated the fitting was excluded from the sale, the buyer has no legal recourse.

It is worth bearing in mind that most sellers will be reasonable and will inform the buyer of any change to plans that had been agreed, albeit informally. It is advisable then to weigh up how important a fixture or fitting really is to your purchase. If not having the item would significantly affect the amount you had wanted to pay for the property, then it would be worth getting the agreement in writing as part of the contract.

However, in many cases an informal agreement made directly with the seller can be sufficient for both parties to get what they want: you need to make a judgement about the situation, what the fitting is worth to you and what it is likely worth to the sellers.  Remember, the value of most average fittings is unlikely to exceed the legal costs involved in pursuing a seller through the Small Claims Court! If you agree to buy fittings in a private arrangement with the seller, separate to the property purchase, you should agree to pay by cash or bank transfer upon Completion, to ensure the items are there and in the condition that you were expecting.

Tax Implications

If the seller agrees to include a specific fixture for a price, this additional amount is taxable under Stamp Duty Land Tax. So, including fixtures in the sale for an additional price will bump up the Stamp Duty.

If a buyer pays extra for Fittings, however, this additional amount is not taxed. This is because fittings are movable, and as such as not part of the property itself. The legal term for such fittings is ‘chattel’. HMRC has a detailed guide on common chattel for those who are unsure. For example, free-standing furniture and appliances, carpets, gas fires.  As these are not taxable, buyers shouldn’t worry about formally agreeing to pay extra for specific fittings in a bid to keep their Stamp Duty down.

The buyer is responsible for submitting a Land Transaction Return Form as part of the conveyancing process, which determines the amount of Stamp Duty they have to pay. Buyers must specify any chattel deducted from the total sale value, and HMRC can investigate these deductions if they suspect Stamp Duty avoidance.

One tax tribunal in particular shows this clearly. In 2010, a homebuyer (Orsman) purchased a property for £258,000, but £8000 worth of ‘chattel’ from this value (including “built-in fitted units with worktop”, amongst other items that she agreed to buy from the seller); as the value of property was £250,000 after this deduction, the buyer paid Stamp Duty at rate of 1%. HMRC investigated this transaction and found that the built-in units in the garage were fixed to the property, so they were not considered chattel. As such, the consideration paid for these (£800) was taxable. The tribunal then found that the total amount to be taxed at the higher rate of Stamp Duty (3%) was £250,800, just over the £250,000 threshold for this rate; in 2012, two years after the property purchase, the buyer had to pay an additional £5000 in Stamp Duty.

The distinction between fixtures and fittings is crucial in terms of the tax implications it can have, so if buyers have agreed a consideration for specific fixtures or fittings, they must understand the difference and complete their Land Transaction Return Form accordingly. 

Summary

When buying a property, it is important to be clear about what will be included and excluded in the purchase. This helps avoid disappointment on Completion day, and can help both buyer and seller plan ahead in terms of what they will need to furnish their new home. It is best to negotiate the inclusion/exclusion of specific fixtures and fittings in person, rather than through solicitors. If a seller agrees to include an important fixture of fitting, make sure this is stated in the contract. If a seller informally agrees to include an item but does not state this in the contract, be aware that they are not obliged to follow through with this.  If a buyer agrees to pay an additional amount for a specific fixture, this may be taxable (depending on whether the item part of the property). Fixtures usually form part of the property itself, and as such as taxable. If a buyer agrees to pay an additional amount for fittings, such as white goods, this amount would not be taxable.