the mortgage &property are owned by my ex partner. i have been contributing a large amount for 15 yrs .The house was bought 17yrs ago. You did not answer the question about tax and would the legal agreement hold up in court ?
Thank you for your reply.I was gathering more information from you before I could answer your question.I take note that you have been contributing towards the mortage etc for past 15 years.As the property is owned by your ex partner and the mortgage is in her name, any gain from sale of the property would be hers and she would have to report it on her tax return.You state she has agreed to give you 40% of the sale of the house (not sure whether you mean 40% of sale proceeds of 40% of profit).You would be best advised to draw up a legal agreement to ensure that she honours her word. A properly drafted agreement (seek a lawyer's help in drawing the agreement) would hold up in court.You will not have to pay any tax on this money as the gain is made by your ex partner.The amount you receive would be regarded as a potentially exempt transfer from her to you for inheritance tax purposes and the seven year rule would apply to it. In simple terms, if she survives for 7 full years after making the gift to you then the gift is out of scope of IHT. More informaation on gifts and implication on IHT can be found under "Gifts that might be tax-free" here
I hope this is helpful and answers your question.
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