Will Stamp Duty be payable?

[cellarboy]

My partner and I are splitting up and she is selling her 50% share of the house to a friend of ours, allowing me to retain my share and stay in the house. The house has been valued at £275000 and we've agreed at £260000 as a total selling price, meaning our friend needs to pay £130000 to buy her out. The friend is looking to borrow this amount by remortgaging with me, a sum total of £195000 (£65000 being my existing mortgage). The current mortgage is only in my name and would, after remortgaging, be in the joint names of myself and the friend.

So my my question is; would STAMP DUTY be payable? and if so, on what amount? It would seem fair that 1% SD would be payable on just the £130000 buyout figure... but this is the Taxman we're talking about! ;-)

So does anyone know for sure?

Cellarboy.

[Ian McTernan CTA]

The solicitor dealing with the SDLT Returns will know the answer and will advise accordingly.

Ian McTernan CTA
McTernan Associates Ltd
Chartered Tax Advisers
ian@imcternan.com