Stamp Duty When Removing Someone off Mortgage

psvr87

Hi

I have a flat which i'm in the process of remortgaging and the solicitor has advised that it may result in stamp duty be appropriate. When i've questioned it they've said they dont give tax advise etc..

This is my situation, i bought a small flat some years back to rent out, just to get on the ladder. At the time i was seen as a first time buyer who wanted a buy to let, which proved troublesome, so to get the mortgage i put my mothers name on the mortgage with me as co-owners. This property was bought for 80k and at the time no stamp duty was applicable.

Since then i bought another property which is my home and because it was seen as a 'second property', i paid a crazy amount in stamp duty.

So now i want to remortgage the flat i rent out. I thought i would take the opportunity to put this in my sole name. Plus my mother is retired anyway, so couldn't get a mortgage.

So here we are she has never contributed in any shape of form, there is no exchange of money. No position will change, apart from the name on the document. I will still have 2 properties. I paid a lot of stamp when i bought my home.

So simple can anyone advise if i will have to pay stamp just to get this in my name?

Many thanks.

SDLT_Geek

If your mother has a half share in your property then I would expect the “chargeable consideration” for your acquisition of her half share to be half of the mortgage debt. I would expect higher rates to apply to that as you let it and have another property.

But perhaps she has no share in the property? Is there a declaration of trust saying it is yours beneficially?

psvr87

There is no declaration or any agreement.

I paid higher rate stamp when i bought my home that i live in, because i also owned this flat.

This would mean i will have paid higher rate stamp for both properties. Surely that cant be right.

If i did have to pay what would it be on? The property was 80k with 43k remaining, which is what is being remortgaged. Is it the 80, half the 80, 43 or half the 43?

Thanks

Cscott139

You would be best to speak to an accountant but in my experience the stamp duty would be payable on half of the amount of the existing mortgage (your mums share) but as this is under £40,000 there may be no stamp duty payable anyway.

SDLT_Geek

I would expect it be on half of the £43,000. That would therefore be below the £40,000 threshold.