Adding a name to Mortgage Title Deeds and Stamp Duty
Discussion
Quick Q, I am currently remortgaging our house but am changing from a sole mortgage to a joint one with my wife. As part of the process apparently I have to change the title deeds with the land registry, which will cost me £300 or so (I believe) all in with solicitors fees.
However, I am not sure whether this then exposes us to a further charge of stamp duty on my wife's new share, even though no money has changed hands.
I am happy to keep it a sole mortgage, but my new lender has insisted that if you are married then the mortgage has to be joint. Any thoughts on the Stamp Duty?
However, I am not sure whether this then exposes us to a further charge of stamp duty on my wife's new share, even though no money has changed hands.
I am happy to keep it a sole mortgage, but my new lender has insisted that if you are married then the mortgage has to be joint. Any thoughts on the Stamp Duty?
Should be fine, SDLT is due on your wife's half of the mortgage amount, not the equity. This becomes the "consideration" and if this in excess of the SDLT level of £125k she would have to pay. In your example her share of your mortgage is less than this.
HMRC info:
(ETA I have assumed she isn't buying her share of the equity from you...?)
HMRC info:
(ETA I have assumed she isn't buying her share of the equity from you...?)
Edited by pacoryan on Monday 25th November 15:25
Edited by pacoryan on Monday 25th November 15:26
knk said:
If it is a gift, there is no SDLT to pay.
Not quite, if there is a gift and no mortgage, then there is no SDLT.From the link above:
"Property given as a gift
If the property is received as a gift there's no SDLT to pay, so long as there's no outstanding mortgage on it. But if the person who receives the gift takes over some or all of an existing mortgage, then SDLT may be payable if the value of the mortgage is over the SDLT threshold."
As said the equity (one assumes) is being given as a gift to the wife so there is no consideration from her for this and no duty payable.
HOWEVER the mortgage is borrowing and she is signing up to be responsible (in the eyes of HMRC) for half the secured debt.
As this is in excess of £40k an SDLT return must be made but there will be no duty payable provided that half the secured debt is <£125k.
It gets more fun when a wife or new partner are “Buying in” to the equity in the property rather than just being gifted the equity share and this catches a lot of people out.
HOWEVER the mortgage is borrowing and she is signing up to be responsible (in the eyes of HMRC) for half the secured debt.
As this is in excess of £40k an SDLT return must be made but there will be no duty payable provided that half the secured debt is <£125k.
It gets more fun when a wife or new partner are “Buying in” to the equity in the property rather than just being gifted the equity share and this catches a lot of people out.
I'm 90% of the way through a similar transaction with SWMBO.
We're going joint equity, so in essence she is taking on 50% of my remaining mortgage debt. If this 50% was above the lower limit for stamp duty piracy then she'd have to pay. It's less than the lower limit, so we're OK. Your solicitor should advise you accordingly.
We're going joint equity, so in essence she is taking on 50% of my remaining mortgage debt. If this 50% was above the lower limit for stamp duty piracy then she'd have to pay. It's less than the lower limit, so we're OK. Your solicitor should advise you accordingly.
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