Stamp Duty Tax on Residential Home with Mortgage - Inheritance from Husband to Wife

Cindyyyy

Hi all,
I’m Cindy, I have lot of things going on after demise of my husband recently. Its quite tough to handle the current circumstances in managing the estates. My husband has inherited our main residential home, together with other assets (like company shares which I have discussed in previous discussions, savings and insurance) to me under the will as the sole beneficiary. 

However, our main home (the one we as a family staying) still has mortgage to be paid off. He purchased this house 5 years ago and sold our previous house for a bigger one (the current house). The mortgage amount left for this house is almost around £400,000. I’m thinking to keep this house as we have lot of memories in past few years here and decided to use the amount received from Insurance payout as well as savings to pay all the remaining amount of mortgage, if its enough to cover. However, If its not enough, then I would try to remortgage the house and continue paying the monthly installment. 

My first question is, 
If in case I have to remortgage the house, do i need to pay Stamp Duty tax or any other form of tax payable?
My second question is,
If its a yes for the first question, do I just need to pay the Stamp Duty tax for the value of remaining mortgage (remaining amount left to pay) or I have to pay Stamp Duty tax for total house value overall?
My third question is,
Is it mandatory to remove my deceased husband name on title deeds & adding my name there ? Currently, his name is on title deeds as the sole owner as he bought it by his own.

I would highly appreciate your kind responses 

DullGreyGuy

Stamp duty is only payable when ownership of a property changes due to a sale (or sale like transfer), inheriting a property doesn't result in stamp duty being payable. Remortgaging is totally unrelated and never triggers stamp duty (let's ignore islamic mortgages). 

You will need to transfer the property into your name 

Cindyyyy

Thank you for your kind response. 

If i have to transfer the property to my name, I have some questions,
First question is, 
Does it a straight-forward process? 

Second question is,
Will it be costly to transfer the name to my name? as its a tough time now..

Third question is,
If I successfully transfer it to my name, will my name is the only name stated in the home’s title deeds with 100% ownership?

I appreciate your kind response 🙏

Keep_pedalling

The process is not expensive and there is no need to hurry on this. Did you jointly own the house or was it just in his name?

SiliconChip

This page describes the process to change the name of ownership and includes a link to the fees that are levied based on the value of the property.

https://www.gov.uk/registering-land-or-property-with-land-registry/transfer-ownership-of-your-property 

If you need help filling in the forms there are many knowledgeable posters on here who will assist, and the Land Registry has an active account on here if there are questions that can't be easily answered.

Cindyyyy

The property is solely owned by my husband as he the one who purchased it and paid the mortgage from the past 5 years. He is recently passed away. However, there is due of £400,000 mortgage need to be paid off as he is no more now, so I am responsible for that (as I’m the sole beneficiary on the Will he left). 

I’m thinking to either pay it full with the savings and insurance payout (if its enough to cover the remaining debt), if its not, then I will try to remortgage the house and continue to pay the monthly installment. 

The issue is,
I have read in several websites that we need to pay Stamp Duty tax if there is still remaining mortgage on the inherited property, so that the beneficiary of the inheritance property need to pay the stamp duty tax according to the value he/she needs going to pay for the remaining mortgage (if the beneficiary willing to keep the property)

Is it true?

RAS

Cindy, Read the first reply given to your initial post

Keep_pedalling

Cindyyyy said:

The property is solely owned by my husband as he the one who purchased it and paid the mortgage from the past 5 years. He is recently passed away. However, there is due of £400,000 mortgage need to be paid off as he is no more now, so I am responsible for that (as I’m the sole beneficiary on the Will he left). 

I’m thinking to either pay it full with the savings and insurance payout (if its enough to cover the remaining debt), if its not, then I will try to remortgage the house and continue to pay the monthly installment. 

The issue is,
I have read in several websites that we need to pay Stamp Duty tax if there is still remaining mortgage on the inherited property, so that the beneficiary of the inheritance property need to pay the stamp duty tax according to the value he/she needs going to pay for the remaining mortgage (if the beneficiary willing to keep the property)

Is it true?

Please be reassured that there is no stamp duty to pay (or any other taxes come to that). 

Because he was the sole owner you (or the executor if that is not you) will need to apply for probate, and you will not be able to transfer the property until you have obtained that.

As for the mortgage, if you have not done so already please contact the bereavement department of the lender to inform them of his death, they should suspend the payments until the insurance comes through. Hopefully you will pay able to settle the full outstanding amount, but if not you will need to take out a new mortgage in your name to cover any shortfall. 

Cindyyyy

Thank you all for your kind responses 🙏