Moving properties into Ltd Co

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    Moving properties into Ltd Co

    I own a semi commercial property from which I run a business and rent to flat above. The outstanding mortgage is £70k.
    I wanted to pay off the £70k and then transfer the property into a limited company but I don't understand if I can transfer the property no outstanding mortgage balance.

    I know that the Limited company has to buy the property at the market value but I can't get my head around the tax and transfer.

    The original purchase price was £131k
    The current valuation is £140k

    Currently in mine and my wifes name.

    The property is registered under your name ( or with wife in joint name ) at Land Registry and your Mortgage Lender has registered a charge on the property title which means you cannot sell without paying off the loan.

    When you pay £70K to the reduce the loan account to zero , you can ask the mortgage lender to remove the charge at Land Registry.

    Then you are free to sell property to the company at £140K. ( probable company does not pay any sdlt , if starting level to pay is £150K for commercial property. ) .

    In your next tax return , you + wife declare capital gains calculated at £140K - £131K = £9K or £4.5K each.

    Since you can claim capital gains allowance of £11,500 , there is no tax to pay.


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    • tax responsibility and allowable expenses
      Hello, wondering if anyone can help.

      Firstly, my husband and I are joint owners of our rental property but I heard that we can change things so the tax is based on my income alone. Is this true? If so how can I go about arranging this. I earn alot less than my husband.

      23-04-2019, 20:58 PM
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      I never ask HMRC for tax advice, I'll ask my accountant next time I see him.
      25-04-2019, 10:42 AM
    • Reply to tax responsibility and allowable expenses
      Send an enquiry to your tax office and ask if they agree with you.
      25-04-2019, 09:50 AM
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      It took me a lot of research and persuasion to accept that a residential loan could ever be allowable as solely and exclusively for a BTL purchase.
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      25-04-2019, 08:26 AM
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      I think you really are " THE ONE " with superior knowledge on tax matters by being able to respond to a far wider range of questions.

      Replying to your question, my thinking ( and I could be wrong ) is :

      When you claim mortgage interest on...
      24-04-2019, 21:36 PM
    • Reply to tax responsibility and allowable expenses
      I bow to your superior knowledge (as always).

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      24-04-2019, 12:52 PM
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      24-04-2019, 11:57 AM
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      If you are the landlord and your husband isn't, the income would be yours.
      It becomes a little more complex if it's paid into a joint account.

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      24-04-2019, 09:30 AM
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      The gain achieved during "primary residence period" is exempt for cgt. .

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