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Sam
Sam, Accountant
Category: Tax
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Hi. Just over a year ago I bought a property with my fiancee.

Resolved Question:

Hi. Just over a year ago I bought a property with my fiancee. Before that, we both lived in a property that she has owned for just over 20 years. I only lived at the property for the last 8. I was not on the deeds of the house. My fiancee wanted to rent the property rather than sell so we organised a BTL mortgage, however as my fiancee was not working at the time I had to be added to the deeds.

I would now assume that we jointly own the property and would be taxed 50:50. My fiancee is now working but only earns £11k a year. I'm a 40% tax payer so would like to "gift" 49% back to my fiancee. Is this possibly as we are not married as I would obviously like to minimise our tax exposure.

It only seems fair as I was only ever added to the deeds to get the mortgage but as far as I'm concerned it is my fiancee's sole property.



I needed to be added to the deeds of my fiancees house in order for her to get a biy you let mortgage on it.
Submitted: 3 years ago.
Category: Tax
Expert:  Sam replied 3 years ago.
Hi

Thanks for your question

As its clear that you have just a name only interest for the purpose of the buy to let, you just need to set up a tenants in common agreement where you will have to own at least 1% (as your names are XXXXX XXXXX deeds) and your partner own 99%
This will also allow this ration to be considered by HMRC for rental income and capital gain purposes.

You cannot go down the route you suggest as HMRC will still treat you as having ownership of a 50% nature (as joint owners) so just consult a solicitor to draw up a tenants in common agreement for you, which is entered into a declaration of trust, and then should HMRC enquire after the ratio split of 1% you/99% partner - then you have all the appropriate documentation in place.
Thanks

Sam

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