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Stamp duty land tax.

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The rule is this: where the Transferor owns subject to a mortgage and transfers the mortgaged property to joint names with another person, he/she is effectively sharing the burden of the mortgage covenants. That is seen by HMRC as chargeable consideration, unless- rarely- the Transfer deed EXPLICITLY states that:

a. all the burden remains with the Transferor and

b. he/she indemnifies the new co-owner against them; and

c. there is no new mortgage covenant given by that new co-owner in favour of either the Transferor or the mortgagee; and

d. no money consideration is passing either.

 

"Sharing the burden of the mortgage covenants", yes, I see that. But does it mean that a sale has taken place, because that's what attracts SDLT isn't it?

And does this apply between spouses where debt and assets can be freely transferred in most cases?

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"Sharing the burden of the mortgage covenants", yes, I see that. But does it mean that a sale has taken place, because that's what attracts SDLT isn't it?

And does this apply between spouses where debt and assets can be freely transferred in most cases?

The 'transferred' portion of the mortgage debt is treated as if it were consideration.

Yes, even between spouses. It's only for IHT purposes that inter-spousal transactions (no, not a euphemism) are disregarded.

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