Stamp duty on transfer between spouses with no consideration

by **oz_shell** on Sat Feb 19, 2011 5:49 pm

Can someone please help me with further information.....?

My husband and I are looking to buy a property, and for the purposes of this example, we will purchase for £160k, borrow for £144k therefore contributing a £14k deposit.

I am not classed as a first time homebuyer, however my husband is, and we would like to make use of the SDLT exemption available to first homebuyers. Therefore we will take out the mortgage as joint applicants (because I am the main wage earner) however we will have the deeds placed solely in my husband's name, therefore qualifying us for the exemption. Our mortgage provider has already confirmed they are happy for us both to be on the mortage and have the deeds in my husband's name only (some solicitors say this is not possible but it is).

We will then, after settlement, have my husband gift me a 50% share of the property so we become joint tenants on the deeds.

My understanding is that this transfer will be exempt from CGT (as gifts between spouses are) however can someone please advise if we will have to pay SDLT on the transfer? I would think not as I already am on the mortgage so I'd say there's no consideration being transferred however I'd appreciate if someone could provide any further information.

by **section 44** on Fri Feb 25, 2011 4:44 pm

oz_shell wrote:some solicitors say this is not possible but it is

I fail to see this being the case. It’s a simple according with a particular lenders terms of business as opposed to whether it is legally possible (as you suggest).contractual matter between the lender and the borrowers and comes down to the terms of business. I am sceptical if many solicitors would fail to appreciate this. Perhaps, rather, they are commenting on the likelihood of this proposal as opposed to whether or not this is legally possible.

It might be worth checking out section 75A of the Finance Act 2003, this may scupper your SDLT planning ... In short, you are proposing some scheme transactions to take advantage of an SDLT relief that is not available to you and your husband as co-owners.