Registering a Second Property

Theonell

My wife has recently inherited a property which we have registered with the Land Registry solely in her name, and we joint own our existing property. I thought I'd read somewhere that you have to inform HMRC if you own two properties but I'm not sure where, and would this need to be done as she doesn't actually own two properties, just the one and part owns the other. 

user1977

What's she doing with the property? If she rents it out, there'll be Income Tax to declare. If and when she sells it, it's potentially going to be chargeable for Capital Gains Tax. But she doesn't need to tell HMRC merely that she's become an owner.

housebuyer143

If she already owns a stake in another property you might have the 3% stamp duty surcharge to pay on registration.

Theonell

We are renting it out and will declare it as income tax and as you say may have to pay capital gains tax when its sold. I thought I'd read somewhere you had two years to register the ownership of a second property when I was doing the paperwork for the estate.

SDLT_Geek

Are you thinking of the time limit to elect for CGT which of two homes is your "main residence"?

Theonell

SDLT_Geek said:

Are you thinking of the time limit to elect for CGT which of two homes is your "main residence"?

The part owned property is her main residence the other one is rented out

Theonell

housebuyer143 said:

If she already owns a stake in another property you might have the 3% stamp duty surcharge to pay on registration.

She owns a stake in the property we live in and is the sole owner of a property we rent out why would we need to pay 3% stamp duty 

user1977

housebuyer143 said:

If she already owns a stake in another property you might have the 3% stamp duty surcharge to pay on registration.

Only on the consideration. Which is zero if she simply inherited it, and no need to notify HMRC for SDLT purposes.

p00hsticks

Depending on which region of which country, she might also need to let the local council know (at least until she gets tenants in) as some charge more council tax for second homes. 

propertyrental

Theonell said:

housebuyer143 said:

If she already owns a stake in another property you might have the 3% stamp duty surcharge to pay on registration.

She owns a stake in the property we live in and is the sole owner of a property we rent out why would we need to pay 3% stamp duty 

This is a red herring. As a married couple your properties are considered as a whole ie you (plural) both now have 2 properties for SDLT purposes.

However the property was inherited. There was zero 'consideration' (purchase price), so no SDLT due.

Income tax and capital Gains in due course but you seem aware of that.

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