Letting relief

[Razariz]

Hi there, wonder if someone could help me. I have owned my main residence since 2011. We got married in 2012 and she moved in as well. Now the property and mortgage has always been under my name. We are now thinking to move to a bigger house and let this one out. My question is if I add my wife to this existing property as she is a low rate tax payer, I will have tax benefit in rental income. Howvever, with regards to CGT, would there be any Benifit or loss if we decide to sell the house in 5years? Also if I add my wife’s name to the property, would we be able to claim letting relief for both of us individually? If yes,then do I have to add her name first and then after that remortgage this property into a BTL or shall I add her name at the time as I am remortgaging it into a BTL? If so,would she still get the letting relief?

Many Thanks In Advance

[bd6759]

You need to give your wife a share of the house whilst it is still her residence. If you do that, she "inherits" your history and both residence and letting relief will be due when it is sold.

[maths]

Whilst i agree that any transfer should take place whilst the residence qualifies as a sole/main residence of both of you the transferee spouse will not inherit any lettings relief.

[Razariz]

Thanks you both for the replies.

So you mean she wouldn’t qualify for the letting relief but will do for CGT relief? Also can you please clarify why wouldn’t she qualify for letting relief?

Many Thanks

[bd6759]

She will qualify for lettings relief. Maths said that she would not inherit any from her husband, but she does not need to. She will acquire it in her own right.