Scottish Stamp Duty (LBTT) Additional dwelling Query

funguy

Thread deleted

booksurr

questions first...
- is there a mortgage on the property?
- is brother party to the mortgage or would you need a new mortgage with him as co-signatory?
either answer impacts on the LBTT relating to the subsequent gift.

the legislation uses the much more meaningful word "disposal" not the word sell,
http://www.legislation.gov.uk/asp/2016/11/section/1/enacted
therefore a gift is a disposal, so provided you did the disposal within 18 months of buying the new place you would be eligible for a refund, (the same applies to SDLT in the rest of the UK, except we get 36 months not 18)

obviously the simplest solution is your last sentence, give him the whole lot from the outset then you won't have to pay the higher rate to start with. Rather depends on how desperate you are for a few months worth of a half share of the rental profit. Bearing in mind that for that short period you will need to: a) register as a LL, b) pay income tax, and c) meet all the other obligations of being a LL. Sounds rather pointless to me, let your brother get on with it alone then it is his decision when to terminate the tenancy - what would happen if the tenants refuse to move out before the 18 months are up? If that happened you'd have to gift it to him anyway just to ensure you get the refund and he'd be left to deal with the eviction on his own, so let him be the LL from the outset.

he can always make a (tax free) gift to you of money afterwards in lieu of your share of the rental profit.