Stamp duty on a house I don't even want
Discussion
So, when I divorced 5 years ago (amicable), we agreed that the wife would own a buy to let we jointly owned and mortgaged. The understanding was that she would remortgage it into her name in time and we could transfer the equity at that point.
Fast forward 5 years and she still hasnt done it. Something to do with affordability rules on the new mortagage.
So I technically and legally own this house. I also own my own home where I live with my new wife.
We want to move. I understand the additional stamp duty will apply.
If I get myself off the BTL mortgage (or she sells its, same thing) can I then retrospectively reclaim the additional stamp duty? I know you can if its your own home, but would it apply in my circumstances?
Fast forward 5 years and she still hasnt done it. Something to do with affordability rules on the new mortagage.
So I technically and legally own this house. I also own my own home where I live with my new wife.
We want to move. I understand the additional stamp duty will apply.
If I get myself off the BTL mortgage (or she sells its, same thing) can I then retrospectively reclaim the additional stamp duty? I know you can if its your own home, but would it apply in my circumstances?
I don't need a solicitor, we're both happy with the way assets were divided at the point of our separation. Tax advice maybe, but divorce advice, no thanks.
Back to the question I posed, my understanding is that if a main residence is being sold and replaced with another main residence, then the number of additional properties owned is irrelevant.
Anybody who can confirm?
Back to the question I posed, my understanding is that if a main residence is being sold and replaced with another main residence, then the number of additional properties owned is irrelevant.
Anybody who can confirm?
MoelyCrio said:
I don't need a solicitor, we're both happy with the way assets were divided at the point of our separation. Tax advice maybe, but divorce advice, no thanks.
Back to the question I posed, my understanding is that if a main residence is being sold and replaced with another main residence, then the number of additional properties owned is irrelevant.
Anybody who can confirm?
This is the government website and the flow chart part way down will explain how it works.Back to the question I posed, my understanding is that if a main residence is being sold and replaced with another main residence, then the number of additional properties owned is irrelevant.
Anybody who can confirm?
If you replace your main residence you don't pay the extra SDLT and if for convenience you buy the new place without selling the current home you have to pay the extra SDLT but can reclaim it provided you don't wait too long
https://www.gov.uk/government/consultations/consul...
MoelyCrio said:
I don't need a solicitor, we're both happy with the way assets were divided at the point of our separation. Tax advice maybe, but divorce advice, no thanks.
Back to the question I posed, my understanding is that if a main residence is being sold and replaced with another main residence, then the number of additional properties owned is irrelevant.
Anybody who can confirm?
That was my understanding. As long as your new house will be replacing the current house as the main residence you will only be liable for the 'normal' SDLT rate. Back to the question I posed, my understanding is that if a main residence is being sold and replaced with another main residence, then the number of additional properties owned is irrelevant.
Anybody who can confirm?
MoelyCrio said:
we agreed that the wife would own a buy to let we jointly owned
My head hurts already.MoelyCrio said:
The understanding was that she would remortgage it into her name in time and we could transfer the equity at that point.
Fast forward 5 years and she still hasnt done it.
So you still jointly own this house.Fast forward 5 years and she still hasnt done it.
MoelyCrio said:
So I technically and legally own this house.
There's no "technically and legally" about it. You DO.MoelyCrio said:
I also own my own home...
We want to move. I understand the additional stamp duty will apply.
Not if you're selling your current home, because you're replacing your current primary residence.We want to move. I understand the additional stamp duty will apply.
If you're not selling that place, then - yes - you will.
Your second property's actually irrelevant in this, because you're either replacing your current primary residence, or you're buying an additional property. Whether it's 2->3 or 1->2 makes no difference.
The only way your jointly-owned place would make a difference is if you didn't currently own your own home, but were renting, and were buying somewhere to live in - because then you'd be going from 1->2, rather than 0->1.
MoelyCrio said:
I don't have anything to do with the other house, so nothing to declare to HMRC.
Not so simple...You're a joint owner. It's rented. You are liable for tax on your share of the rent. Whether you then choose to gift that rent back to your ex is your own business...
How's it owned? Joint tenants, or tenants in common?
PurpleMoonlight said:
TooMany2cvs said:
Not so simple...
You're a joint owner. It's rented. You are liable for tax on your share of the rent. Whether you then choose to gift that rent back to your ex is your own business...
Quite.You're a joint owner. It's rented. You are liable for tax on your share of the rent. Whether you then choose to gift that rent back to your ex is your own business...
Potential CGT liability too.
No CGT implications as no capital gains in the last 10 years. I used to live in anyway, so some sort of relief would be due I imagine.
MoelyCrio said:
No CGT implications as no capital gains in the last 10 years. I used to live in anyway, so some sort of relief would be due I imagine.
Really? - you bought a house ten years ago and its worth less now?I believe you're correct in that CGT doesn't apply for a period during which you can prove residence
MoelyCrio said:
I don't need a solicitor, we're both happy with the way assets were divided at the point of our separation.
Until she want's more.http://www.dailymail.co.uk/femail/article-4198010/...
TooMany2cvs said:
She should have only been declaring her portion. Is your tax rate higher than hers?
I Seem to recall that it is allowable for one party of a jointly owned BTL property to apportion their share of the rental income to the other party. Not sure if it requires it to be notified in advance though.PurpleMoonlight said:
MoelyCrio said:
I don't need a solicitor, we're both happy with the way assets were divided at the point of our separation.
Until she want's more.http://www.dailymail.co.uk/femail/article-4198010/...
I note the OP is not concerned about formally finalising the financial agreement reached with his ex-wife but, be warned, if there is not a Court approved (i.e. stamped) financial agreement or a Court order made at a Court hearing dealing with the matrimonial finances then it is likely that ALL financial claims between both ex-spouses remain open, potentially forever. This even includes claims against each other's estates on death meaning that this could impact your loved ones after you die.
The only proviso to this is that re-marriage of one of both spouses may now prevent financial claims but it is not clear whether that is the case for the OPs ex-wife and it also depends on how the divorce petition was drafted.
However, for the others of you that may read this and whom may have concluded a divorce but not formally settled financial matters - be warned. Your ex-wife/husband is likely to have the right to claim against your existing and future capital (i.e. property/savings etc), pensions and income. It is huge risk for most people to leave such claims open in this way and can often be easily avoided by having an informal agreement drawn up in writing and sent to the Court who dealt with (or is dealing with) the divorce. That will then bring to an end the financial claims you each have against each other.
In the OPs situation, it's impossible to know what risks there may be. However, as a new wife and another property has been mentioned, it would seem to me that there is a chance (however slight) that the ex-wife could try to claim more against him if, for example, her finances ever take a turn for the worse, even if she is foolish with her money.
Sorry for hijacking the thread but I see this day in and day out at work and also have the misfortune to see how bad it can be if an ex-spouse suddenly makes a financial application decades after the original divorce. Just look at the tale of the now infamous (in divorce solicitor circles) Mr Vince who had nothing at the time of his divorce but has recently had to pay out to his wife and her solicitors some 20+ years later. A fair warning for all (as often the paying party is not anywhere near as wealthy as Mr Vince was) - https://www.theguardian.com/business/2016/jun/10/e...
Edited by madmatteo on Tuesday 7th February 14:52
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