Gifting half the house tax liability

[Zippyworld]

My missus wants to give me half ownership of our house. We are not married.
We have lived together for 15 years and have two dependant kids.
There is £100k left on the mortgage. Its value is £650k.
The mortgage is in her name.

The question is will either of us be liable to pay any tax if we do this ?

I realise that we will speak with a solicitor and the mortgage lender, but first shout is the taxation rules.

Advice would be greatly appreciated

[Sheepshanks]

Zippyworld said:

The question is will either of us be liable to pay any tax if we do this ?

Nope.

[Zippyworld]

I have had more helpful answers, thanks anyway.

[anonymous-user]

Inheritance tax liability if she dies within 7 years.

You will need to remortgage into joint names.

[Sheepshanks]

Zippyworld said:

I have had more helpful answers, thanks anyway.

It's a simple question with a simple answer.


Worth digging into the future IHT point though to make sure either it won't apply or you have it covered.

Edited by Sheepshanks on Thursday 29th September 18:56

[rfisher]

Probably wrong but;

Remortgage as joint applicants.

Go for tenants in common.

Jobs a good 'un.

No 7 year death problems as it's joint ownership.

No nasty IHT as each owns half separately.

No problem with losing the house if 1 of you needs care home fees paying out of it, as the other can't be forced to sell.

[STattam]

If you are transfer equity only then no tax. If transferring title and equity and therefore 50% of the debt then SDLT will be payable as consideration os disposal of 50% of the debt.

[STattam]

Sorry re above, just noticed mortgage balance and therefore 50% of it I well below sdlt limit so ignore me!

[uknick]

rfisher said:

Probably wrong but;

Remortgage as joint applicants.

Go for tenants in common.

Jobs a good 'un.

No 7 year death problems as it's joint ownership.

No nasty IHT as each owns half separately.

No problem with losing the house if 1 of you needs care home fees paying out of it, as the other can't be forced to sell.

Yes, you are wrong about the IHT aspect.

Without the spousal transfer exemption the gift will be subject to the 7 year rule. It may also be considered a gift with reservation (GWR), so will always be part of her estate. If it passes the GWR test (unlikely as she will still be living there) it may fall foul of the previously owned asset test (POAT), see link. Although POAT is unlikely if OP and missus share all housing costs.

I assume the OP's missus wants to avoid IHT so she should take professional advice before they commit to anything. If not, they could go through all the fuss of changing ownership and still find they're still liable to the various taxes.

http://www.taxguide.co.uk/content/about-poat-pre-o...