SDLT on transfer of equity to Wife

[ToplessMonster]

After having done quite a bit of research I was wondering if anybody is able to help me.

I got married last year and am looking to transfer equity to my wife so that our main residential property is owned jointly. We will be remortgaging to carry out home improvements. She already owns a property that is rented out. The value of the property is £425k and the outstanding mortgage is £150k.

If I transfer equity I understand that SDLT will be due on the outstanding amount of the mortgage (50% of £150K). However my question is, will this be subject to the additional 3% of SDLT? Ordinarily the SDLT would be £0, but trying to clarify if I will be subject to a charge of £2,250.

Thanks

[CaptainSensib1e]

As far I understnad, assets can be transferred between spouses without any tax liability. I transferred some shares with a large embedded capital gain over to my wife for tax reasons, and didn't have to pay any tax on the transfer.

[Eric Mc]

The rules for one form of tax (Capital Gains Tax) will not be replicated in other forms of tax, such as Stamp Duty Land Tax. Here's the HMRC guide to spousal transfers of land and property. It's not as straightforward as you might think -

https://www.gov.uk/guidance/sdlt-transferring-owne...

[ToplessMonster]

Eric Mc said:

The rules for one form of tax (Capital Gains Tax) will not be replicated in other forms of tax, such as Stamp Duty Land Tax. Here's the HMRC guide to spousal transfers of land and property. It's not as straightforward as you might think -

https://www.gov.uk/guidance/sdlt-transferring-owne...

Eric, thanks for the link. I have already read that, as you say it's not straightforward at all! The example provided still does not clarify the situation. Ordinarily there would be no stamp duty payable on the £75k, but as my wife already owns a property I don't know if we will be subject to the 3% stamp duty for second properties.

[Eric Mc]

I would say that if ordinary SDLT doesn't apply, then the 3% additional SDLT doesn't apply either.

[STattam]

SDLT is payable on consideration. No consideration as no debt being
Passed as transfer of equity only so no SDLT.

[Eric Mc]

You just need to be clear what is meant by "consideration". It doesn't have to be an actual transfer of money. Taking on a share of someone else's debt may be considered consideration as well.

[STattam]

Agreed hence why I mentioned no debt transfer.