Stamp Duty

ezee_duzit

Hi, I have owned a property before but my girlfriend hasn't. We have just taken a mortgage with HSBC and have been told that they will allow two people to be named on the mortgage taking both our earnings into consideration but only having one of us named on the deeds, this being my FTB girlfriend. I have spoken with solicior and he sees no problem and then approx £200-300 to change the title deeds later on. Obviously there is risk with this but could well save us £1350!!

Could someone please confirm whether there will be any issues with this and whether we would still have to pay stamp duty when trying to add my name to the deeds?

Thanks

Cannon_Fodder

Never heard of a joint mortgage allowing a single name on deeds. It would be a first, and whilst opening up benefits to some - not just your own SDLT gain, but couples that split up being able to move on, and such like - it would also open up a can of worms, i.e. should you split up before the deeds were changed to joint, or (without wishing anything bad to happen) what would happen if she died unexpectedly...

Minefield. Doubt it is accurate. Probably some undertrained pleb at the bank getting confused.

Get it in triplicate from someone senior at the bank, before you make any commitments/outlay on the strength of it.

ezee_duzit

Thanks for your response, obviously I am at risk here but would intend on adding my name shortly after completion. Apparently HSBC are the only bank to allow this, I am unsure but they see there being no problem as does my solicitor. As I type I have just received a call from the land registry stating the same thing. Will go back to HSBC and get someone else to confirm again as potential savings would be a huge benefit to us and probaly many others!

<sebb>

I bet the HMRC wouldnt be too happy if they found out you'd done this. Wouldnt be worth the risk IMO.

ezee_duzit

Which is what I was worried about, although I would see it as avoidance rather than evasion! I have emailed the FSA to see what they say before I go any further

sunshinetours

If your solicitor is happy to recommend this in writing then I can't see you have too many worries. If you are worried about being worried about it going forward, then don't do it!!

Providing your girlfriend is a genuine first time buyer then I can't see there are too many issues if she is the sole name buying the house. The mortgage is not a legal document of ownership to my knowledge.

Guidance from HMRC is typically poorly worded http://www.hmrc.gov.uk/sdlt/reliefs-exemptions/overview.htm#15
The main issue would be that your girlfriend hasn't owned any land or property anywhere in the world previously.

Ask your solicitor to put it in writing that you can do this and I think you will find your answer however....!

zappahey

ezee_duzit wrote: »

Which is what I was worried about, although I would see it as avoidance rather than evasion!

Unfortunately, it's not your perception that counts

ezee_duzit

Thanks for your advice, think i'm going to see what response I get from the FSA and have a contact number for HMRC so will see what they have to say. Will also get my solicitor to include something to cover our butts!!

Below is my response from Land Registry, who would have no issues adding me on at a later stage although she suggests getting additional advice regarding any breach of rules:

Hi xxxx,

I'm not sure about the legalities of Stamp duty and am not allowed to give any legal advice. So far as Land Registration goes each transaction is treated individually so I don't believe we would question an application sent in later to register both of you. You would need to speak to the Stamp Duty office or get legal advice to check that you are not breeching any rules.

Regards
xxxxxxxxxxxxxx
Customer Support
0844 892 1111

sunshinetours

Land registry wiouldn't have any issue as they just process the forms
I would remove the email contact details from your post as not good to include someone's personal email reply with their contact details

FSA almost certainly will not tell you anything (and not sure why they would in this case anyway) and HMRC contact number will be staffed by a call centre worker who will advise you that most tax is self assessment and you need to do it yourself and probably refer you to the same guidance I did.

You are paying your solicitor for professional advice so you can make an informed decision (not to cover your butts!) and if they are happy to give an opinion that this is fine to do you then have in theory recourse to them if that advice proves to be "incorrect"

It will come down to how you want to proceed

Squish_21

Have you deducted the £200-£300 title deed change from the £1350?

If its only for the sake of approx £1k I personally wouldnt bother with all the hassle, just pay it.

ezee_duzit

Squish_21 wrote: »

Have you deducted the £200-£300 title deed change from the £1350?

If its only for the sake of approx £1k I personally wouldnt bother with all the hassle, just pay it.

Sorry but like most in this economic climate £1k will go a long way for us and probably many others! If I had a thousand pounds to throw away I wouldn't bother with the hassle!