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TaxRobin
TaxRobin, Tax Consultant
Category: Law
Satisfied Customers: 15880
Experience:  International tax
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i have a buy to let accommodation with a mortgage on and only my name

Customer Question

i have a buy to let accommodation with a mortgage on and only my name on the mortgage - i am a high tax payer 40% and my wife does not work;
can i do a deed of trust to transfer the property to my wife - do i need a solicitor for this and do i need to fill form 17 at HMRC or not ? will this affect capital gains or can i switch back before i sell as my wife has never lived in the property so will not get private residents relief
Submitted: 2 years ago.
Category: Law
Expert:  TaxRobin replied 2 years ago.
Hello,
You would need to file the Form 17 if you have the property as joint with your spouse. If your spouse has all ownership of the property you would not need to complete Form 17.
A house is held in the sole name of you, and the Land Registry documents confirm this. The house is rented out and the rents are paid to you. You want to claim that all the rent is taxable on your wife.
You could produce a ‘trust deed’and claim the ‘trust deed’ transfers the right to income to your wife, but even if the trust deed does validly transfer the right to all of the income from you to her, that would constitute a settlement of the right to income, because you would still retain an interest in the property itself. Consequently and all the income would remain taxable on you.You would need to make certain that the total ownership of the property was transferred to your wife.
You should use a solicitor.
Yes it is possible for your wife to transfer the property to you in a later time. You would not be allowed all the relief for residence either depending on when you sell. The letting time would be applied anyway.