Deed of trust

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    Deed of trust

    What valid reasons are there for having a 80/20 split or a 90/10 one, other than for tax avoidance?

    Obviously it is for this purpose, but this is virtually our only option to prevent us losing money each year on our rental and we can't sell it either. I have spoken to an accountant and this is always suggested, but what do you tell the solicitor?

    #2
    Tax avoidance is not illegal, so tell them its to minimise tax.
    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).

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      #3
      Originally posted by October 82 View Post
      What valid reasons are there for having a 80/20 split or a 90/10 one, other than for tax avoidance?.....
      Well, there is the outside chance that those %ages reflect the actual split of ownership: A bit radical I grant...
      I am legally unqualified: If you need to rely on advice check it with a suitable authority - eg a solicitor specialising in landlord/tenant law...

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        #4
        An accountant friend has suggested a 100/0 split would work. Solicitors haven't said anything to the contrary. I assume solicitors submit paperwork to Inland Revenue and I submit Form 17. In either of the aforementioned paperwork do I have to explain split or just if they contact me and query it?

        Not wanting to annoy people who hold a different opinion, but I gave up a well paid job to look after two children (1 and 3) because I was earning nothing after childcare costs. I have lost a wage and a pension and I manage all of the rental, including repairs, tax returns - everything. I feel entitled to 100% and he agrees. If I could get a BTL in my name I would.

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          #5
          The conventional split is 99:1 as 100:0 isn't a split, its ownership by one person.

          If you are married, there's a presumption that the income and outgoings split is 50:50.
          People's affairs aren't like that, so the trust mechanism is available.
          You are simply organising your tax affairs so that you pay the appropriate amount of tax - you won't have to explain to anyone, it's a common process and used by lots of people who's tax rates are different for any number of reasons.
          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


            #6
            Originally posted by jpkeates View Post
            The conventional split is 99:1 as 100:0 isn't a split, its ownership by one person.
            That's what I thought, but it's what the accountant said and he is a partner in a large firm.

            So, we get a BTL in both names.
            Get solicitor to do deed of transfer to split ownership by 99:1
            The solicitor said she would send some SDLT forms to the Inland Revenue
            Then I or we both complete a Form 17 to inform IR of the split

            Thanks, just don't want to make a mistake.

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              #7
              Deed of trust, not transfer.
              Sounds good.
              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

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