Tenants in common with Mum, lots of questions.

Mojisola

PrinnyPree said:

People seem to think I'm trying to make money out of my Mum, I just want to jointly invest in a property with her because shes seen one she likes that is out of her price range. I didn't even suggest a loan another poster did and now the topic is completely derailed from my original question.

Ignore those who are making you feel like that.  It's perfectly sensible to expect some return on your money - it would be gaining interest if you put it in savings or saving you money if you paid off your mortgage.

You won't be taking anything from your mother - the money will only come back to you when your mother no longer needs the house you are helping her buy.

If your siblings complain, remind them that they could have done what you're planning to do but they chose to spend their money on themselves instead of helping your mother out.

SDLT_Geek

oldbikebloke said:

PrinnyPree said:

davidmcn said:

Would be simpler to just lend her the money? If you're an owner then the whole price will be subject to the additional rate of SDLT (or LTT) as its a second property for you. 

Ah well this is what I wanted to know, I can't seem to find any info online of how this works say if a house is £350k I put in £35k mum puts in £315k would the stamp duty be worked out as £18k as a second home instead of £7.5k notmal? That definitely puts a different spin on things.

whilst a loan and charge would be simpler, higher rate SDLT does not apply (assuming you are in England  - different rules other places) because your share would cost (be worth) less than £40,000 
https://www.gov.uk/hmrc-internal-manuals/stamp-duty-land-tax-manual/sdltm09780

This is wrong unfortunately.  If the price of the house being bought is over £40K (which is the case here) then even if the share in the new house of the person who would be liable to the higher rates is worth under £40,000, then the purchase as a whole is liable to higher rates SDLT.  See https://www.gov.uk/hmrc-internal-manuals/stamp-duty-land-tax-manual/sdltm09764  The reference to SDLTM09780 is misleading as that refers to Condition C (other properties a person owns and their value).  The relevant condition is Condition A, about the price for the property being bought.  see https://www.gov.uk/hmrc-internal-manuals/stamp-duty-land-tax-manual/sdltm09770.

[Deleted User]

PrinnyPree said:

Thankyou xylophone the previous posters made me feel like I was being underhand.  I'm happy enough to just pay off my own mortgage or invest the money in some other way like lifetime ISAs. My Mum will be able to find a slightly cheaper house eventually I'm sure. It was literally a question we thought of in the last 24 hours, a kind of what if that I thought was mutually beneficial.  But not something I would persue if either if us lost out financially, got taxed to the hilt of if family got upset.

Absolutely no one on this thread has suggested you are trying to make money from your mum so I have no idea where you are getting that notion from.

If you want to pay the higher rate of SDLT on the purchase, CGT when the property is eventually sold and for, at least a portion, of the repairs and maintenance for the next 20 years then knock yourself out and jointly purchase the property with your mum.  This is a money saving website so if posters are suggesting alternatives it's perhaps because it's to try and save you money.

csgohan4

charging interest will need to be declared on your tax return as it would deemed as a form of income