First time buyer with non first time buyer

Legacy_user

Hello,

I have never owned any property so I'm definitely a first time buyer. My partner had a property a few years ago but it's already sold. My understanding is that she is not a first time buyer anymore because she has owned a house at some point.

What would be the best option if we would like to buy a house now? I can think of:
1. Simply pay a full stamp duty. As far I understand if one of persons is not a first time buyer we simply would need to pay full tax. It's quite annoying as we both rent right but it looks like first time buyer = first time owner.
2. I could be a sole owner of this house. This works but has a lot of bad sides like:
a) she would not be an owner and she would not have any rights to the house. We trust each other but If something bad happens to me I want her automatically get full rights to the house.
b) I dont know how we could use her money for the deposit. If she simply transfers it to me we would need to pay a gift tax

Is there any other way ? What do you think?

davidmcn

Do you need the income from both of you for your mortgage? Is your partner going to be happy putting in money without having her name on the title? What country's "gift tax" would apply?

G_M

piotrzi wrote: »

Hello,

I have never owned any property so I'm definitely a first time buyer. My partner had a property a few years ago but it's already sold. My understanding is that she is not a first time buyer anymore because she has owned a house at some point.

What would be the best option if we would like to buy a house now? I can think of:
1. Simply pay a full stamp duty. As far I understand if one of persons is not a first time buyer we simply would need to pay full tax. It's quite annoying as we both rent right but it looks like first time buyer = first time owner.correct
2. I could be a sole owner of this house. This works but has a lot of bad sides like:
a) she would not be an owner and she would not have any rights to the house. We trust each other but If something bad happens to me I want her automatically get full rights to the house.So write a will
b) I dont know how we could use her money for the deposit. If she simply transfers it to me we would need to pay a gift tax What 'gift tax'?

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System

I'm not familiar with "gift tax" but I meant "Inheritance Tax: Gifts - GOV.UK" (I can post links here so just Google that phrase). It looks like if it's less than 325k then it's tax free. Am I correct?

@davidmcn we don't need income from both of us but if we use our both savings we would get better mortgage offer or it could be cash only transaction which is cheaper than mortgage. We have both around 50% of property value. She is happy to not have her name on the title but I'm concerned about the tax implication of the money transfer and the situation like my death, critical illness (for example being unconscious but still alive) etc. If i's going to be too complex then I will probably pay the stamp duty tax.

@G_M - we already got a will but I have no idea how easy it would be for her to get the house after my death with the will plus what if after accident I'll be unconscious but still alive. I'm not sure about other implications of our decision?

davidmcn

piotrzi wrote: »

I'm not familiar with "gift tax" but I meant "Inheritance Tax: Gifts - GOV.UK" (I can post links here so just Google that phrase). It looks like if it's less than 325k then it's tax free. Am I correct?

Inheritance Tax applies when somebody dies - if that happens then gifts they made during the seven years prior to their death can be taken into account when calculating the value of their estate. There is otherwise no tax in the UK on gifts.

If you want somebody to be able to manage your affairs if you lose capacity then you want a Power of Attorney. In that respect it doesn't make a great deal of difference whether you own 50% or 100% of the property.