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Aston Lawyer
Aston Lawyer, Solicitor
Category: Law
Satisfied Customers: 10176
Experience:  Solicitor LLB (Hons) 23 years of experience in Conveyancing and Property Law
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Please advise on the following scenario: I own a property

Customer Question

Please advise on the following scenario:

I own a property with a mortgage. I wish to Pay off the mortgage and make it freehold. I then wish to transfer the mortgage deeds to my Mother as I am leaving the country and have no need for the house. Is there any tax burden/ inheritance tax associated with this transfer as I am kind of gifting it back to my Mother.

Initially the house was gifted to me by My mum 13 years ago for no money exchange i.e deeds were transferred to my name I simply wish to do the same but pay off the mortgage first.
Submitted: 2 years ago.
Category: Law
Expert:  Aston Lawyer replied 2 years ago.
Hello and thanks for using Just Answer.

My name is Al and am happy to assist you with your enquiry.

Provided you pay off the Mortgage before the Transfer, this is a relatively simple process.

If you are gifting the property to your Mother, and she is not paying anything for it, there will be no Stamp Duty or other tax to pay upon completion of the Transfer.

I would suggest that you pay off your Mortgage and then you will need to instruct a Conveyancing Solicitor to prepare the necessary Land Registry Transfer document, which transfers the property to your Mother, and which will need to be signed by you.

The only tax which is relevant to this transaction is Capital Gains Tax (CGT). If your Mother is not living at the property (ie it is not her principal place of residence), then she may have CGT to pay as and when she sells. This will be the case if the property has increased in value from the date she acquires it and the date she sells it. She would need to speak to an Accountant as and when she intends to sell, and he will be able to advise her fully on CGT.

I hope this assists and answers your question.

Kind Regards
AL

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