Relief from higher rate SDLT for spouse transfers – true or false?Make Text Bigger
I would like to transfer my 50% interest in a mortgaged BTL to my spouse who already owns the other 50% as tenant in common. We also own the family home.
No CGT on transfer between spouses – so that is not an issue
Transfer would be by declaration of trust without changing the Land Registry entries.
I read in the Finance Act 2018, Schedule 11, Para 9A that:
“(1) A chargeable transaction is not a higher rates transaction for the purposes of paragraph 1 if—
(a) there is only one purchaser,
(b) there is only one vendor, and
(c) on the effective date of the transaction the two of them are—
(i) married to, or civil partners of, each other, and
(ii) living together (see paragraph 9(3)).”
We satisfy these conditions. However I see no mention of this on property/legal websites subsequent to the initial announcement of the provision and the HMRC SDLT calculator does apply this provision.
My first question – is my understanding correct that I can make this transfrer at the standard SDLT rates (applied to my share of the mortgage on the property) and do not have to pay the higher rate?
I also read on the HMRC website:
“If the larger share is given outright as a gift
If you take a bigger share but don’t pay anything in return, there’s no ‘consideration’ given including taking on liability for a mortgage. You won’t pay SDLT, even if the value of the extra part of the share is more than the SDLT threshold. You don’t need to tell HMRC about the transaction.”
Second question – does SDLT apply to the transfer if it is for a transfer to an existing part owner, regardless any mortgage or any spouse participation? I have not found the legal basis for this statement by HMRC.
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