Thank you for your question..
According to tax rules, if you live together with your spouse or civil partner, HMRC would normally treat income from property held in your joint names as if it belonged to you in equal shares and tax each of you on half of the income, regardless of actual ownership.
You need to have a declaration of interest or deed of trust if you wish your beneficial interest in it to be dealt with it differently. As the property is held in your name only, the steps you wish to take would suffice to support splitting the income and gain equally. My personal view is that a Statutory declaration of interest would be sufficient to achieve the desire results and it is not necessary to have a deed of trust in place. Maybe you should suggest this to your specialist firm executing a Deed of Trust.
More on declaration of beneficial interests in a joint property and income is covered here (Form 17)
Trustees pay no Capital Gains Tax when they sell a property the trust owns. It must be the main residence for someone the trust says can live there.
More on this is covered here
The gain is covered by private residence relief. Renting the property will have an impact on your private residence relief whether the property is placed in Trust or not.
You need not attach a copy of the Trust Deed to your self assessment tax returns.
Once you start earning rental income you would report it by completing supplementary pages SA105 UK property and show your share of income and profit respectively. No need to advise of the trust every year.
I hope this is helpful and answers your question.
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Just checking to see if there are any issues from my last posting that need further clarification or does my response answer your question.
Thank you for your reply.
There is no need to attach a copy of the Trust Deed to your self assessment tax returns. You retain the original in the event there was an enquiry and The Tax office needed some proof. The same applies to Statutory declaration of trust. Once you have the property in joint names, HMRC would take the income and gain as being shared equally unless you advise them otherwise. There are no adverse CGT or other tax implications in using the statutory declaration of interest.
If the property is in trust and it is used as main residence then there is no CGT payable.
Also if any CGT was payable the the gains allowance will be lower and you get one lot of gains allowance only.
I am suggesting you opt for statutory declaration of interest.
I hope this is helpful.
Thank you for your reply..
The link here explains when CGT might be payable
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