First of all, apologies: it's a common question but I'm still confused. I have a pension income above the tax free threshold; I also have a rental property that was my main home for many years before being rented out for the last 4. There is no mortgage. My partner (we're not married) will have no income in the next tax year. However, she will be buying a home for both of us to live in, which will exceed the value of my rental flat. Ideally we want her to receive at least 13,500 of the rental income (being the tax free allowance plus 1,000 rental allowance). I think we can declare her as a beneficial owner and use form 17 to give her 90% of the income. I've read about 'declaration of trust' but not sure if we need this also. I believe there is no SDLT payable if we do this; I'm not sure about the CGT position.
Am I correct in my analysis? Do we need to be married or in a Civil Partnership to do so? Is it possible to change the amount of beneficial ownership in future if necessary? Is there any other suggestion for how we might utilise her tax free allowance given our circumstances? Advice very much appreciated.
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