Removing Sibling off Property Deeds

KiranMac

Hi there, my sister and I are joint owners of our flat, she is gifting me her share and there is a mortgage that I will cover myself (and can afford to). My question is, is there any SDLT I will owe, even though I paid it when we bought the place?

Many thanks,

Slithery

Not sure about SDLT but you will need to pay off the current mortgage and get a new one in just your name.

SDLT_Geek

KiranMac said:

Hi there, my sister and I are joint owners of our flat, she is gifting me her share and there is a mortgage that I will cover myself (and can afford to). My question is, is there any SDLT I will owe, even though I paid it when we bought the place?

Many thanks,

If you are equal owners of the flat then I would expect the "chargeable consideration" for SDLT to be half of the outstanding mortgage amount.

KiranMac

Thanks SDLT_Geek. If I wanted to change it to a BTL would the same SDLT apply?

KiranMac

I should add, that when I initially bought it, I bought it alone and added her to the deeds and mortgage 7 years later. So I paid SDLT on the whole flat when I initially bought it.

SDLT_Geek

KiranMac said:

Thanks SDLT_Geek. If I wanted to change it to a BTL would the same SDLT apply?

As well as considering the amount of the chargeable consideration, you need to work out what rate of SDLT will apply.  If this counts as an "additional property" then the 3% extra might apply.  Do you have other property interests, or is this the only property you have an interest in?

KiranMac

I have a BTL property in addition to this one but this is my main home. If I turn it into a BTL then I will move into another property with my partner. Thanks so much for your advice :-)

canaldumidi

As above, you will need to pay off the existing joint mortgage.

And apply for a new BTL mortgage in your sole name.

And transfer the property into your name - SDLT will be due on half the outstanding  mortgage (the amount you are effectively paying your sibling). As this will be a 2nd property and as this is not going to be your main residence, the additional 3% SDL will apply.

If you are also buying a new property as your main residence, I suspect standard SDLT will aply to that, not the additional 3% though this depends on whether it is considered you are 'disposing'of your current main residence, which it appears you are not since you are making it a BTL.

KiranMac

Thank you canaldumidi. Half the outstanding mortgage will be less than £125K so does that mean there is nothing to pay if I carried on living there? Should I move out, will the additional 3% apply on the £125K?