Transfer Ownership of property

jane_wellsman

We purchased a leasehold flat 2 years ago . Because my husband had been ill we thought it would be easier we put it in a childrens name. We rent the property out and the income comes to us

Now my son is looking at the goverments help to by scheme It says he is not eligible because he has a interest in another property.

Are we able to transfer the property back into our name

Pixie5740

If there is no mortgage or other charges on the property then yes your son can transfer the leasehold to your name. He may have CGT to pay and although the rental income has been coming to you, I hope he has been paying income tax on that rental income.

HappyMJ

jane_wellsman wrote: »

We purchased a leasehold flat 2 years ago . Because my husband had been ill we thought it would be easier we put it in a childrens name. We rent the property out and the income comes to us

Now my son is looking at the goverments help to by scheme It says he is not eligible because he has a interest in another property.

Are we able to transfer the property back into our name

Yes you can but that won't make him eligible for government assistance as the HTB ISA is for people who have never had an interest in a property anywhere in the world ever...

As it was your mistake that has cost him £3,000 I would be giving him £3,000 of my own money to him and apologize for ever putting him on the title.

foxy-stoat

I do not see why you put this in your son's name becuase your Husband was ill....but assuming there is no mortgage, as regulated buy to lets are hard to come by, they you can fill out the forms from the Land Registry and the building owner and your good.

booksurr

foxy-stoat wrote: »

I do not see why you put this in your son's name becuase your Husband was ill....but assuming there is no mortgage, as regulated buy to lets are hard to come by, they you can fill out the forms from the Land Registry and the building owner and your good.

consider if husband died and the property had been part of his estate for IHT purposes. If the son owned from the outset then that would not apply.

Let us also hope the "children" who are the current legal owner(s) are over the age of 18, otherwise this would be a parental trust and the parents would be taxed on the income anyway.

However, for CGT purposes the fact the children have never lived there, have not taken the income, and have no stake in the property other than legal ownership, means the parents are in fact the beneficial owners as they take the rental income (assuming the kids have not paid anything towards the property themselves). CGT is based on who is the beneficial owner, not who is the legal owner.

So, subject to professional advice, transferring the property "back" into the parent's name will not be a disposal for CGT purposes by the child, as the child has no beneficial interest in the property to start with, so has no CGT liability for it. As such the child can sign over the property by simple completion of the TR1, AP1 and ID1 if the parents wish to DIY it on the cheap.

G_M

* if there is no mortgage, yes the property can be transferred into your name (not "back into our name" as my understanding is you've never owned it).

* But I doubt tht will help with a claim for the goverments help to by scheme

* As the property has not been the owner's primary residence, Capital Gains Tax will apply when it is sold or transferred

* I assume the property owner (not necessarily the person who collects and/or keeps the rent!) has been declaring the rent for Income Tax.......?

* I also assume the owner understands, and complies with, all thier responsibilities as a landlord?



Edit:
See here:
Who is eligible?

To qualify for a Help to Buy: ISA you must:

• be 16 or over
• have a valid National Insurance number
• be a UK resident
• be a first time buyer, and not own a property anywhere in the world
• not have another active cash ISA in the same tax year: If you have opened a cash ISA this tax year, you can open a Help to Buy: ISA but will have to take additional steps. See the FAQ for more detail.

Land_Registry

foxy-stoat wrote: »

I do not see why you put this in your son's name becuase your Husband was ill....but assuming there is no mortgage, as regulated buy to lets are hard to come by, they you can fill out the forms from the Land Registry and the building owner and your good.

Online guidance and links to forms etc available here

As posted if mortgaged then lender will need need to consent and will most likely insist on your using a conveyancer

booksurr

G_M wrote: »

* As the property has not been the owner's primary residence, Capital Gains Tax will apply when it is sold or transferred

which owner? the legal one or the beneficial one?

I appreciate you cross posted with me, so probably missed that nuance.

G_M

booksurr wrote: »

which owner? the legal one or the beneficial one?

I appreciate you cross posted with me, so probably missed that nuance.

Fair point (I assume - I'm no expert!).

Though it seems like a distinction that provides all sorts of tax 'avoidance' possibilities...... sigh!

booksurr

G_M wrote: »

Fair point (I assume - I'm no expert!).

Though it seems like a distinction that provides all sorts of tax 'avoidance' possibilities...... sigh!

Lol, I thought you were above the knee jerk response from artfullodger when it comes to "tax" questions!

https://www.gov.uk/hmrc-internal-manuals/capital-gains-manual/cg11730

G_M

you've just seen through my veneer of competance.