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Remember that there is no SDLT relief for a transaction arising on a marriage
(or an unmarried couple setting up home together or entering into a civil
partnership).
Remember that there is no SDLT relief for a transaction arising on a marriage
(or an unmarried couple setting up home together or entering into a civil
partnership). Often, however, there will be a transfer from one partner to the
other, in which case the ‘consideration’ for SDLT purposes will be (i) any
cash payment, and also (ii) any assumption of liability to pay a mortgage
(which will depend on the proportion of the property being acquired):
Illustration: house is worth £180,000. Transferor has equity of £90,000, and there
is a mortgage of £90,000. The transferee pays a cash sum equivalent to half the
equity and gets a 50% share in the property. Consideration will be the cash
payment, plus 50% of the outstanding mortgage (ie £45,000 + £45,000 =
£90,000). Note that although there is no tax to pay (because it is below the SDLT
threshold of £125,000) a land transaction return will still be required.
Different rules apply if a property transfer takes place on a divorce (ie in
pursuance of a court order or an agreement between the parties in
connection with divorce, nullity of marriage, or judicial separation, or the
dissolution of a civil partnership). In that situation, the transaction can be
self-certified to the LR (using SDLT 60) and no land transaction return is
needed. If it does not come within that exception then SDLT will be charged
on the same basis as above:
Illustration: house is worth £350,000, with an equity of £250,000 and a mortgage
of £100,000. One partner buys out the other for a cash sum equivalent of 50% of
the equity, and acquires sole ownership. The consideration will be the cash
payment, plus 50% of the outstanding mortgage (£125,000 + £50,000
= £175,000). SDLT will be 1% (£1,750).
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