Will changing ownership reduce Stamp Duty?

tloz123

Hi. 

I currently have a property under my name. I had bought this before marriage.
There is currently 26 years left on the mortgage. Mortgage value: 183k.

I am now thinking to buy a house with my wife. She is a first time buyer.

At the moment, if we buy a house together, for a 450k property, we’ll be charged 35k stamp duty.

If I were to transfer ownership to my mum on the house I own, and put my mum on the mortgage (since this is the lenders requirement), will this be enough to reduce my stamp duty bill to possibly 12k?

Or will I have to make a deed of trust to notify that I am not financially interested in the property?

Are the paperwork’s too involved that I’ll need to hire a solicitor or is it something I could potentially do on my own?

Keep_pedalling

Did you not like the answers you got on your other post?

https://forums.moneysavingexpert.com/discussion/6605949/ways-of-reducing-the-stamp-duty#latest

imperial1

No, simply changing ownership (like transferring property to a family member or business partner) does not automatically reduce Stamp Duty. HMRC still charges Stamp Duty based on the property's value and any consideration (like money or debt) involved in the transfer. Always consult a tax advisor before making changes.

tloz123

Keep_pedalling said:

Did you not like the answers you got on your other post?

https://forums.moneysavingexpert.com/discussion/6605949/ways-of-reducing-the-stamp-duty#latest

It’s a bit different, the potential solution I outlined in this thread refers to NOT having a financial interest explicitly via the deed of trust. 

imperial1 said:

No, simply changing ownership (like transferring property to a family member or business partner) does not automatically reduce Stamp Duty. HMRC still charges Stamp Duty based on the property's value and any consideration (like money or debt) involved in the transfer. Always consult a tax advisor before making changes.

I am aware my mum will have to pay Stamp Duty if I were to add her onto the deed. 

It’ll be based on the mortgage value so the stamp duty wouldn’t be too much to pay for her.
Ofc I’ll need to pay CGT etc.

But the goal is to have stamp duty reduced, but fully eliminated so that won’t be possible.

booneruk

imperial1 said:

No, simply changing ownership (like transferring property to a family member or business partner) does not automatically reduce Stamp Duty. HMRC still charges Stamp Duty based on the property's value and any consideration (like money or debt) involved in the transfer. Always consult a tax advisor before making changes.

If you're going to copy and paste AI generated text please mention you're doing so. It can sometimes be completely inaccurate.

p00hsticks

Gifting an entire property to someone else, incurring CGT on the way, just in order to pay less SDLT brings the 'don't let the tax tail wag the dog' saying to mind....

Keep_pedalling

There is also the possibility of creating an IHT liability for your mother’s estate.

Hoenir

If you add your mother to the mortgage. Will the lender allow a 26 year mortgage term?