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Process to transfer ownership
Ed-1
Posts: 4,002 Forumite
Current situation:
Owner A has a 2/3 share of ownership.
Owner B has a 1/3 share of ownership.
What is the process to get to the following situation?
Owner A has a 1/2 share of ownership.
Owner C has a 1/2 share of ownership.
Owner B disposes of their share and is no longer an owner.
Is there a transfer of equity involved or is it a purchase/sale?
Owner A has a 2/3 share of ownership.
Owner B has a 1/3 share of ownership.
What is the process to get to the following situation?
Owner A has a 1/2 share of ownership.
Owner C has a 1/2 share of ownership.
Owner B disposes of their share and is no longer an owner.
Is there a transfer of equity involved or is it a purchase/sale?
0
Comments
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Sounds like a gift from A&B to C. What is the relationship between the three? Do any of them actually live there? Depending on the answered CGT could be an issue here.0
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Owner A = daughterKeep_pedalling said:Sounds like a gift from A&B to C. What is the relationship between the three? Do any of them actually live there? Depending on the answered CGT could be an issue here.
Owner B = father
Owner C = daughter's partner.
History:
Father originally owned house for 5 years before daughter purchased 2/3 share from father. No CGT was payable here (within tax-free limit).
Daughter lives in property. Daughter's partner now wants to own property jointly with daughter.0 -
If father is gifting anything to partner then that may be considered deprivation of assets should father need local authority support for care. (time scales are not relevant).
If both father and daughter are gifting to partner what will happen if partner leaves? If partner owns the property then daughter may well have to sell or get a mortgage to pay off partner.
Having partner purchase their share from the other 2 may be the most fair and less complicated in the long run.I’m a Forum Ambassador and I support the Forum Team on Debt Free Wannabe, Old Style Money Saving and Pensions boards. If you need any help on these boards, do let me know. Please note that Ambassadors are not moderators. Any posts you spot in breach of the Forum Rules should be reported via the report button, or by emailing forumteam@moneysavingexpert.com. All views are my own and not the official line of MoneySavingExpert.
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How does this work in terms of solicitors required? Is this classed as a transfer of equity or a sale/purchase?Brie said:Having partner purchase their share from the other 2 may be the most fair and less complicated in the long run.
Does the capital gains tax calculation apply separately to daughter living in the property and father who isn't?
Is it calculated as follows?
18% x [Price share of property sold for - (percentage share in property) x (price paid for property originally + buying costs) - selling costs - tax-free allowance]0 -
Is there a mortgage involved, either currently or required/planned by new owner?
Is any money changing hands or is ownership being gifted?1 -
No mortgage currently but the new owner will be using a mortgage to part-finance their purchase of half the house.propertyrental said:Is there a mortgage involved, either currently or required/planned by new owner?
Is any money changing hands or is ownership being gifted?
The half share is being sold for half the market value of the property.0 -
how are the shares held are you joint tenants or tenants in common at present
the best way would be to gift B's share to a and c - there is no stamp duty on gifts.0 -
"If father is gifting anything to partner then that may be considered deprivation of assets should father need local authority support for care. (time scales are not relevant)."
not if the father does not need or anticipates needing care at the time of disposal (age concern have a very good article on this)0 -
B will then simply gift his share to A and C and pay capital gains tax on any increase in value - as you said in your calculation it will be 18% unless the gain pushes him into the 40% tax bracket in which case some will be at 28%0
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