Many people want to know how to transfer ownership of the house to a spouse, how long will the process takes, and what are the right ways to get into the process? It is a common act to transfer ownership of the property to your spouse as it is beneficial from the tax viewpoint. However, there are few things to consider, such as, does the transfer of ownership to your spouse require stamp duty, or is there any capital gains tax you need to pay?
In this article, you will get to know how specialists handle the whole process of transfer of ownership to your wife for tax purposes or add their names to the legal title. Before getting into details let’s understand the difference between the legal owner of a property and who gets the advantage from property that includes right of use or property income.
Legal Owner
A legal owner is registered at the land registry on the title deeds. These legal owners are also referred to as registered owners or nominees. There can be only four legal owners registered on the title. They have complete control over the property that is sold or transferred.
Beneficial Interest
The term beneficial interest refers to the interest in the financial benefit of property. It is your share of any loss or gains from the property that includes rent and profit or loss on the sale. You don’t need to be a legal owner for a beneficial owner. Many couples share the beneficial interest with their partner but don’t share the legal title because if they want to share property income in a tax then it is not necessary to change the legal ownership.
How to Add Your Spouse to the Deed of Your House?
There are multiple ways to transfer property to your spouse to get them a share of beneficial ownership. Check out the following descriptions to find what suits your requirements.
Property in Sole Name
If you already own a property and it’s in your sole name, there are some options to consider while transferring the beneficial interest to your spouse or husband.
Transfer of Equity
In this case, the purpose is to transfer title to spouse or husband to add them to the deeds of the property as joint legal owners. Usually, the partner is transferred onto the legal title for no extra money changing, and after the transfer, you own the legal and beneficial interest. Here are also some other points to be considered:
Stamp Duty Land Tax
No matter, you have paid the stamp duty land tax when purchasing the property, if you transfer ownership of the house to your spouse, you’re still required to pay stamp duty if you have a mortgage.
Deed of Trust
When you share income from property in uneven shares, you’re required to file a legal form and provide a deed of trust ensuring the beneficial interest among the joint owners. If you’re unable to do this, the income from the property is equally shared among the joint owners.
Mortgage Lender Consent
Many mortgage lenders don’t allow to transfer of beneficial interest to someone not a party to the mortgage. In this condition, you should assign the beneficial interest instead of using the deed of assignment.
Deed of Trust or Deed of Assignment
You can assign beneficial interest to your wife using a deed of trust or deed of assignment. A deed of trust involves how the property is managed and sold. Whereas, a deed of assignment assigns the benefit from one party to another. Both of these deeds are beneficial for the transfer of ownership of the house to a spouse in an effective way. A legal owner can use a deed of trust to share the beneficial interest in the property to his wife, and important points to consider are:
Beneficial Owner has No Legal Owner Rights
The beneficial owner has no legal right to sell the property unless written into the deed of trust. They can get beneficial interest from a potential capital gain through the sale.
The deed should be Registered
A deed of trust must be recorded with a restriction placed over the title deeds at the land registry to secure the non-legal owner from the property being sold without their permission.
Property Owned Jointly
If you own the property jointly, you can consider transferring the beneficial interest to your spouse or wife.
Deed of Trust
A deed of trust is used for an unequal beneficial interest among joint owners. If you own the property as joint tenants or tenants in common, you will be required to change the owner before you can register the deed of trust. You can never legally own the property as joint tenants and have a deed of trust.
Not Purchased the Property
If you’re planning to purchase the property, you can buy the property as tenants in common and draft a deed of trust to reflect unequal shares in the property.
SV Conveyancing Assists with Transfer Ownership of House to Spouse
SV Conveyancing is a platform that caters to the transfer of ownership services across all types of property with years of experience in the relevant industry. We keep informed our potential clients’ with the insights of the procedure. Our expert team is highly concerned about your security and goes ahead with an exclusive approach to get your transfer through as soon as possible. Our specialists mainly concentrate on the preparation of your legal documents and paperwork arrangements to avoid delays.