Deed of trust for tax efficiency

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    #16
    Ok let's say at the point of purchase of this property, which was about ten years ago, my wife contributed a certain amount to deposit but we have no proof, does this stand a claim to add her to mortgage or am I am just going to waste my time.

    My other option would be to change to a BTL

    Early repayment charge: £1800
    New mortgage fees: £1400

    Tax bill till 2023: £9000

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      #17
      You don't need anything to add your wife to the mortgage other than an approved application.
      Where the deposit came from won't change that.

      For the avoidance of doubt, if it was a residential mortgage, you almost certainly had to notify the lender where the deposit had come from when you applied.
      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


        #18
        Thanks.
        Yes it was a residential mortgage which has now got consent to rent.

        My option now is

        Get a new BTL mortgage with joint names
        Do a DOT with Wife on 99% beneficial interest

        Is there an SDLT concern I need to be mindful of?

        Comment


          #19
          Originally posted by ThePalmist View Post
          Is there an SDLT concern I need to be mindful of?
          Yes, the "gift" has a consideration at 50% of the mortgage value, which is subject to SDLT.
          Unless you or your wife own another property, that's currently only applicable if the consideration is more than £500k.

          You should get proper legal advice though!
          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


            #20
            Thank you.

            Yes I have a mortgage on my name only on our home where we live.

            She doesnt own any other property.

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              #21
              So I managed to get a new application started with Natwest and all was going well till it came to applying , they wont proceed application because I am doing a joint remortgage but previous mortgage was not joint !!! This is after all affordability checks on both names.

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                #22
                similar situation as yours. What did you do in the end? just curious

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                  #23
                  Originally posted by londonrulz View Post
                  similar situation as yours. What did you do in the end? just curious
                  Hey booked a phone appointment and proceeded with NatWest, they do joint remortgage just not online.

                  All approved but I am stuck on sdlt and dot issues as per my other thread :-)

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                    #24
                    Just as an update guys, I have got the new mortgage with joint names in place and a deed of trust is being drawn with 99 to Mrs and 1 to me split.

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                      #25
                      Hi Folks,

                      So I have finally received confirmation that we are now tenants in common with Wife 99% and me 1%, this was filed with land registery on 29 December 2020. I am assuming there is nothing else to do, when the time comes to file return, I just take 1% of income in my tax return and wife does her return with 99% of the rent money. How do we split expenses and is there any other form to fill? Does anyone know?

                      thanks in advance,

                      Comment


                        #26
                        You need to confirm the change to HMRC using Form 17, and, from the details supplied, I think you've missed the deadline for doing that.
                        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


                          #27
                          Oh no, I have been waiting on lawyers but had to ring land registry myself. They said it was filed by lawyers on 29 December but added to Land Registery on 04 February 2021, will the date count be from December or from January ?

                          thanks in advance JpK

                          Comment


                            #28
                            I'm a little confused to be honest.

                            The deed is enough to change the percentage of ownership, there's no need to register it with the land registry, although obviously you can.
                            I think that the deadline for the HMRC notification is 60 days - hopefully the lawyers who made the deed can advise.
                            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


                              #29
                              So I have been calling lawyers, LR and Tax office.

                              LR says there is note about split beneficial interest on register but I have to request a copy.
                              Lawyers say they posted me DOT in January but I have not received it.
                              Tax office say that I need to fill the form 17 within 60 days of DOT so if the date on DOT was December then I have to get a new DOT.

                              I have been reading up and I gather that 60 days means the date from signing the form, meaning irrespective of when I get DOT, Form 17 signing date needs to be within 60 days of it being received by HMRC. I debated the same with Tax Office Technician who seemed adamant that I need a DOT. I find that strange.

                              So next steps

                              I have filed a complaint to lawyers asking to send DOT copy asap.
                              I am sending an OC2 to LR for Registry details to add with Form 17
                              Will send both as evidence with Form17 and back date to stay within 60 days of when I send the form.

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