Question

[DisappearingPart]

Suppose someone (good friend) has offered quite a large amount of money (100k) in exchange for half ownership of mortgaged property, but is happy to just 'give it' rather than go through legal channels, would there be any tax implications?

The house is currently owned equally between two partners, one of whom is going to remain owning half the property with investor friend, and the other will be able to take a sum equal to the amounts paid over the years in order to clear debts, but there will be money left over.

The person selling half, if it is their only property would have zero tax implication as money from selling sole residence is exempt from income tax I believe - please double check.

Person buying half will only have legal implications if they sell their half if they already own another property - they will pay tax on the sale of a property that is not their sole residence.

You must transfer ownership of the property otherwise there will be all sort of legal nightmares in the future on all sides. You do this via land registry I believe.

Thanks, will check on that. There is another thing to ask (but not very good at explaining things, so bear with me):

Partner selling out to friend has paid one third of mortgage but has paid all bills and food etc for same period of time, making expenditure between both partners equal. So for example, if the partner paying the third had not been able to pay bills etc then neither would be able to live in the house without the other.

Would it be fair in this case, for a 50% split of mortgage paid so far to be awarded to the partner who paid the third?

Well I would say yes on my understanding of what you've paid.

Total household expenditure has been split 2 ways, so in a way it's irrelevant that technically they only paid a third into mortgage IYSWIM.

Thank you so much.