Any legal experts?

[AprilSkies]

I am feelin my leasehold flat to the freeholder. They want to do a surrender of lease rather than a transfer of lease? What are the pros and cons?

Selling not feelin...

It has the same effect from your point of view, ie you divest your interest to the Landlord. For the Landlord it means that the lease ends, rather than is assigned to them for them to later merge with the freehold, and remove from the Land Registry. 6 of 1 and half dozen of the other!

As long as you get the consideration you have agreed then it should not matter to you.

Great thanks, I think it might also be heaped in terms of conveyancing fees?

Cheaper

An assignment and a surrender are both relatively short and sweet so should not make a huge difference to fees.

Ok thanks. Maybe it's just easier for the freeholder which is why they are pushing for it. Also, do you know if capital gains is chargeable on furniture?

Yes, it makes sense for the freeholder and should not bother you either way.

Not a tax lawyer sorry!

They want to buy the furniture in a separate transaction, wondering if this is beneficial to me regarding tax implications of sale or if there is any other reason they want to do it.

Did you mean SDLT? No SDLT on furniture. You would pay CGT on any gains you make on the sale of the items, if you are selling them for much more than you paid, ie a valuable painting or antiques. If they are just sofas etc then I doubt you will be flogging them for more than you paid and therefore no gain, no tax.

Again, they probably just have a precedent sale of chattels document and think that is easier than trying to showhorn those provisions for the furniture into the deed of surrender.

What's SDLT, sorry for the ignorance.

What was formerly known as stamp duty, the tax on buying properties.

Great, understand stamp duty you don't pay stamp duty when you sell? But capital gains would be non existent on furniture... Think they are trying to make the offer more attractive for me by paying x for the flat and x for the furniture, instead of paying it in one lump sum that I have to pay tax on.

Only the buyer pays stamp duty so in this case that is your landlord.

You will only pay cgt on the gains made from the sale of a property which is not your principal residence (remember the MPs expenses story - if you own more than one property you choose which is your principal residence).

Do you have a solicitor acting? Perhaps if you have more than one property it may be worth taking some tax advice now to ensure you have the principal residence point covered off?

Will do, thank you do much for your advice.