Private Sale to Family member- land Registry checks

KhalA

My mum would like to give her house to me for market value. We don't want to pay conveyancing fees as the value of the property is around £70,000 and I have read online that it's quite easy to do yourself. I have filled in the two forms TR1 and AP1 and completed 2 ID1 forms for myself and my mum.
My question is: how do Land Registry check the proof of funds transfer when it's a private sale without solicitors?
Is it ok just to transfer over the funds from my bank to my mums bank? How/when do they check this?

Thanks

43722

Tell your mother to get independent legal advice before doing this.

KhalA

The property is freehold in England

KhalA

43722 said:

Tell your mother to get independent legal advice before doing this.

She has already. She actually wanted to gift it to me as I financed it and paid off the mortgage. She wants to dispose of it now to minimise tax as she is pensioner. She has another property. 

I thought the best way to do the transfer was for monetary value- not a gift. But just want to make sure I am doing it correctly.

Keep_pedalling

If she is gifting the house to you why is any money changing hands?

Which house is this, her home or the other house? If the former I can’t see how this reduces her tax burden, if the latter (which I presume is rented out) it only reduces tax at the expense of reducing income.

propertyrental

The LR are not interested in how or when any money changes hands. That's between you and mother. Just declare the amount involved both to LR on TR1 and to HMRC on your SDLT return.

Others have raised Qs regarding the reason/wisdom of the arrangement which may or may not achieve the desired aim

EssexHebridean

KhalA said:

43722 said:

Tell your mother to get independent legal advice before doing this.

She has already. She actually wanted to gift it to me as I financed it and paid off the mortgage. She wants to dispose of it now to minimise tax as she is pensioner. She has another property. 

I thought the best way to do the transfer was for monetary value- not a gift. But just want to make sure I am doing it correctly.

If you have already paid for the house then surely your mother would simply do this as a transfer for no value - it's a paper exercise relating to changing the name on the deeds. I'm unsure why you are looking to in effect pay again for a house you have already paid for once? why was the house put into your mother's name in the first place if you paid for it?

And the LR don't make any checks on proof of funds - all they are interested in is ensuring that the property is registered correctly. 

KhalA

If you have already paid for the house then surely your mother would simply do this as a transfer for no value - it's a paper exercise relating to changing the name on the deeds. I'm unsure why you are looking to in effect pay again for a house you have already paid for once? why was the house put into your mother's name in the first place if you paid for it?

And the LR don't make any checks on proof of funds - all they are interested in is ensuring that the property is registered correctly. 

Thank you everyone for the useful replies.

To answer your questions: my mum bought the property when I was a child and when I started working I paid it off.  

The house was my mum's main residence for 23 years, but I recently let it out to tenants for the last few years. She moved in with another sibling. So it's to avoid any capital gains tax she may have to pay. 

The property does not meet Stamp duty threshold so do I still need to do a SDLT return to HMRC? 

propertyrental

CGT  is unlikely to be an issue for your mother if t was her main residence for 23 years and only let out for ' a few years'. Plus of course there's her annual allowance.

Re SLT see

https://www.gov.uk/guidance/stamp-duty-land-tax-transactions-that-dont-need-a-return

KhalA

propertyrental said:

CGT  is unlikely to be an issue for your mother if t was her main residence for 23 years and only let out for ' a few years'. Plus of course there's her annual allowance.

Re SLT see

https://www.gov.uk/guidance/stamp-duty-land-tax-transactions-that-dont-need-a-return

Yes I've just checked on the CGT Calculator and there is no CGT.


Revised: After the useful advice given on here, I've decided to transfer the property as a gift. It is much simpler and the most logical thing to do. Someone just suggested it may be beneficial to transfer for a value so that in the future if the property is sold, there is a market value for the property on Land Registry. So I thought I should look into this option too.