How do you declare your stamp duty?
Any stamp duty land tax should be declared and paid to HMRC within 30 days after completion of the transaction otherwise you may incur penalties. You can file your stamp duty land tax return with HMRC by clicking here https://www.gov.uk/guidance/stamp-duty-land-tax-online-and-paper-returns and pay any liability by clicking here https://www.tax.service.gov.uk/pay/stamp-duty-land-tax/choose-a-way-to-pay.
No second home stamp duty for transfers to spouse
Whilst normal stamp duty bands are applicable there is no second home stamp duty for transfers to civil partners or spouses where they were living together when they bought the property. Under SDLT - higher rates for additional dwellings: purchasers with a spouse or civil partner it states:
From the 22 November 2017 - transfers of interests between spouses and civil partners
From 22 November 2017, the higher rates’ rules disregard transactions solely involving the transfer of interests between spouses or civil partners while they are treated as living together on the date of purchase – see section 1122 of the Corporation Tax Act 2010 for more details [Para 9A].
If, before or after the transaction takes place someone other than the spouses or civil partners has an interest in the property, the transaction will still count as a higher rates transaction. For example, a transaction would not be disregarded where an interest owned by a wife and her otherwise unrelated business partner is transferred to her husband.
How can you reduce the consideration to nil?
Where you transfer the beneficial interest for no money the deed can be drafted to confirm that whilst the beneficial interest can be transferred, the actual existing debt/s on the property do not and are solely the responsibility of the assignor. This would mean that as long as there was no money changing hands, the existing debt remained the liability of the parties on the mortgage and not the party being assigned the beneficial interest or any other consideration, then there will be no stamp duty payable. You should always speak to HMRC to confirm your stamp duty liability based on your own personal circumstances.
Do you need a deed of trust?
Our solicitor specialises in drafting deeds of trusts and deed of assignment. Whether drafted for tax purposes or to protect your interest we offer both standard and bespoke deeds to suit your circumstances.
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