Transferring property to a family member
One of the most frequently asked questions that The BLA members ask our Landlord Advice line is about transferring property to a family member.
As many landlords know the tax rules have changed and new ones continue to pound landlords.
Q. I own a property with my son jointly owned with him, the property is let to tenants. I want to transfer the property to his name only.
My question is do we have to pay stamp duty on the value of the property even if there is no exchange of money?
A. If you and your son decide that he is going to be the sole owner of the property, then he will have to pay Stamp Duty Land Tax. If the value of the half that you are transferring to your son is more than £125,000.
Buy-to-let and second home Stamp Duty tax bands | ||
---|---|---|
Brackets | Standard rate | Buy-to-let/second home rate (April 2016) |
Up to £125,000 | 0% | 3% |
£125,001 – £250,000 | 2% | 5% |
£250,001 – £925,000 | 5% | 8% |
Stamp Duty Land Tax is a progressive tax paid when purchasing a freehold, leasehold or shared ownership residential property over £125,000 in England, Northern Ireland and Wales.
However separate Land and Buildings Transaction Tax applies in Scotland. New SDLT rates were introduced in 2014’s Autumn Statement. These new tax rules introduced a sliding system based on thresholds and dependent on a property price.
You should not rely on this information as there may be factors that may affect your tax liability, You should always seek professional tax advice as tax rules continue to change.
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Disclaimer:
This post is for general use only and is not intended to offer legal, tax, or investment advice; it may be out of date, incorrect, or maybe a guest post. You are required to seek legal advice from a solicitor before acting on anything written hereinabove.