Transfer beneficial interest

Collapse
X
 
  • Filter
  • Time
  • Show
Clear All
new posts

    Transfer beneficial interest

    I own a property in my sole name.

    I want to transfer 50% of the beneficial interest to my wife. Property has £100k mortgage. Not looking to make any changes to title deeds.

    Is my understanding correct as below:

    - I sign a declaration of trust giving her 50% beneficial interest.
    - no need to inform mortgage lender since deeds not changed
    -no need to inform HMRC except when I do tax return next year.
    - annual income from property will be split 50:50
    -CGT upon sale will be 50:50?
    - no stamp duty will be payable due to mortgage size

    Is this correct?

    #2
    I believe if wife is not named on the mortgage loan , she cannot include mortgage interest in her 50% share of the maintenance expenses

    Comment


      #3
      You may need your mortgage lender's permission and should check that before you do anything.
      The trust will reduce the value of the security of the lender's loan by 50% and they might have an issue with that.

      The lender's charge on the property may need to be varied.

      Your wife will need to advise HMRC of her new source of income and agree how it will be reported to them (usually by self assessment).

      CGT when sold will be based on 50% of the gain from the date of the trust, you can't backdate it.

      And I share Gordon999's view of the interest allowance.
      When I post, I am expressing an opinion - feel free to disagree, I have been wrong before.
      Please don't act on my suggestions without checking with a grown-up (ideally some kind of expert).

      Comment

      Latest Activity

      Collapse

      • Reply to Tax Return or Letter?
        by Claymore
        Yes, I agree with that statement....
        17-02-2020, 17:16 PM
      • Tax Return or Letter?
        by Claymore
        Hi

        I remember there being a rental income limit where you don't need to actually complete a property tax return. Instead of completing the tax return you can write a letter to the tax office declaring the income and net profit. Is this still in practise?

        Also, if you do...
        17-02-2020, 16:41 PM
      • Reply to Tax Return or Letter?
        by jpkeates
        When they contact HMRC to tell them they're starting a new business, HMRC will tell them how they want it reported.
        If it's trivial, they may collect the tax through PAYE and allow a simple adjustment at the end of the year, but normally they seem to default to asking for a full return.
        ...
        17-02-2020, 17:13 PM
      • Reply to Is this allowed? Change % income for joint ownership year on year
        by jpkeates
        Civil partnership is essentially the same as marriage for tax purposes.

        Unmarried couples (who aren't in a civil partnership) don't have to split the ownership to account for the income how they see fit, and no form 17 is needed.
        And no change of ownership means no lender issues....
        17-02-2020, 13:02 PM
      • Is this allowed? Change % income for joint ownership year on year
        by bhodgkiss
        Hi All

        Just bought a BTL with my partner

        im in the 40% tax bracket and she doesn't work so we'll be splitting the income 1%/99%

        in the 1st year of ownership, I believe we'd benefit more if I took 99% income - as then I'd also take 99% of any running costs for that...
        16-02-2020, 14:00 PM
      • Reply to Is this allowed? Change % income for joint ownership year on year
        by OneSmallStep
        Hi,
        Would you therefore class yourselves as a Civil partnership and are living together? I don't think a simple letter will suffice.
        Joint Tenants are unable to split the ownership. You need to be Tenants in Common, then you need to complete Form 17.

        However, the Mortgage...
        17-02-2020, 12:36 PM
      • Reply to Is this allowed? Change % income for joint ownership year on year
        by jpkeates
        Obviously you should take advice from your solicitor over any opinion I offer.

        The situation with jointly owned property for married couples is different to that of non-married couples.
        There's a presumption that married couples (while having separate tax affairs) share everything...
        17-02-2020, 10:07 AM
      • Reply to Is this allowed? Change % income for joint ownership year on year
        by bhodgkiss
        Thanks All
        So yes this sounds like it's fine to do.
        each year we simply decide the split and let HMRC know with a simple letter
        And yes I understand ref product fees and now getting less relief under new rules
        17-02-2020, 09:03 AM
      • Reply to Is this allowed? Change % income for joint ownership year on year
        by jpucng62
        I appreciate tax evasion and avoidance are different jpkeates, but where do you draw the line?

        My husband and I changed a BTL from joint names to my sole name to save tax. I was asked by my solicitor at the time whether I was likely to sell it in the near future because if HMRC deemed that...
        16-02-2020, 20:58 PM
      • fire doors upgrade requiremet
        by halfax
        due to himo rule change, i have at the local council requirement had to change all doors to fire doors.
        is this a capital expense or general maintance?
        16-02-2020, 14:49 PM
      Working...
      X