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Joint property owners but changing share in property

(3 Posts)
Schnullerbacke Mon 11-Feb-13 20:28:54

I would be very grateful if someone could point me into the right direction.

Just completed SA tax return. We are renting out our house as we are currently not living in UK due to work circumstances. Our rental income is equal to mortgage outgoings.

My DH would have had to pay extra tax on rental income and as I dont work, I didnt have to pay extra. Looking through the help notes it appears that the shares of a property can be changed. So, although we both own the property, we could elect myself to hold all of the shares and thus the income.

I know we need to fill form 17 in so let them know that this is what we are planning to do. However, it also asks for proof of change and I wonder who this can be done. Will a simple document, signed by us both suffice or do we need to get a solictor involved?

Thank you.

Boomboomboomboom Mon 11-Feb-13 20:55:35

I think you could both sign a document that states that you now hold the property as tenants in common in X and Y shares, which is witnessed by a third party (most property transactions require a witness). If he isn't to own any shares then it isn't a joint property,and your mortgage company would probably have something to say about one of their JT divesting himself of the whole of the asset against which the mortgage is secured.

It's a bit illegal though, if it isn't true - tax evasion, rather than tax avoidance.

If your rental income is equal to mortgage outgoings - what tax is there to pay? Against profit you can offset mortgage interest (but not capital repayments), agent fees, and I think costs associated with upkeep so really there would be minimal tax to pay.

I paid 40% on a few hundred quid and my husband 23% or whatever it was when we were in a similar position.

mumblechum1 Mon 11-Feb-13 21:20:20

You'd have to sign a Transfer Deed (Form TR1), however as Boomboom says, your mortgage lender may not agree to transfer the mortgage account into your sole name. You'd have to do the conveyancing through a solicitor and they would register the change of ownership at the Land Registry (if the lender agrees to release your husband).

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