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Posted Mon, 10 Apr 2023 12:41:40 GMT by S0787571
We live in Scotland in a flat where title deed is solely on my name. My wife isn’t on mortgage or title deeds. In future plan to rent out the flat. Where I am a high tax payer than my wife. So I want to move the rental income to my wife and let her do the self assessment without changing remortgage process. On mortgage we both would like to be there. So please do clearly let me know if there is a quick easy process, I declare the rental income will go 100% to my wife, without changing any deeds. Else do let me know the steps in order to take to make this happen.
Posted Thu, 13 Apr 2023 14:11:20 GMT by HMRC Admin 10
Hi S0787571
Thank you for your question.
A form 17 is only needed if the property is already held in joint name and you wish to declare an unequal share.
We would expect to see a valid declaration of trust showing the split.
With regards to tenants in common please see guidance below:
Joint property ownership
Posted Sun, 15 Oct 2023 15:23:19 GMT by S0787571
A deed of assignment is supposedly better, if I want to move 100% rental income to wife, and I keep paying mortgage on rental property. In this scenario. Husband - 0% rental income but has property on his name with mortgage being paid. Can he claim any thing at all. Wife - 100% rental income but doesn't pay mortgage on the property, can she claim all other expenses, except cannot claim mortgage interest. Finally both husband and wife do full jobs and Pay tax in UK. So will husband benefit by making self assessment for mortgage interest, will that reduce his annual salary tax? Based on the above then I can consider deed of assignment to my wife who is on lowest annual tax bracket than me.
Posted Tue, 17 Oct 2023 09:31:58 GMT by HMRC Admin 17

Thank you for your question.

If the mortgage is in the husbands name only then the wife cannot make a claim for the interest as she has not incurred it.

If all of the rental income is chargeable on the wife then no relief for the interest could be claimed by the husband.

Providing the wife has incurred the other qualifying expenses then these can be claimed against the rental income . 

Thank you .
Posted Tue, 17 Oct 2023 09:45:30 GMT by S0787571
What if the rental expense and mortgage all paid from joint account. So can they can be all claimed then?. And with deed of assignment produced for 100% rental income to my wife.
Posted Tue, 17 Oct 2023 13:44:22 GMT by HMRC Admin 17

Thank you for your question.

In this case, the account to which the rental expenses and mortgage are paid do not need be reflected as we must consider who has beneficial interest in each of the legal deed and rental income.

As per your previous question, as you are the one who makes mortgage payments, you have incurred that expense solely, whereas your Wife bears individual ownership of rental income.

In this case, by creating a Deed of Assignment assigning 100% of the rental income to your Wife, you may claim mortgage interest only, whereas your Wife may claim property expenses but not mortgage interest.

Posted Tue, 17 Oct 2023 14:12:18 GMT by S0787571
Thanks for that so you are saying I can claim the interest on the mortgage even if I have moved 100% of rental income to my wife. But what will mortgage interest go off, if I have 0% rental income from property. Will the interest of the mortgage go of my full time job and tax I pay for that?
Posted Tue, 17 Oct 2023 19:09:07 GMT by S0787571
I am considering adding my wife on the mortgage and deeds. If I do that then my wife with 100% assignment. can claim all the interest on mortgage and all expenditure. If I get that clarity, then I will start that process.
Posted Wed, 18 Oct 2023 13:34:14 GMT by HMRC Admin 10
thank you for your question.
Relief in respect of mortgage interest can only be claimed if you are declaring property income.  
It cannot be used against any other income to reduce your tax liability.  
Posted Wed, 18 Oct 2023 13:36:11 GMT by HMRC Admin 10
Thank you for your question.  
If you add your wife to the mortgage and deeds, you will be required to complete a Form 17 to declare your unequal interests in the property and income.  
If your wife is receiving 100% of the property income and incurring 100% of the expenses, then she will be able to claim relief.  
There is further guidance at TSEM9800 onwards. 
Posted Wed, 18 Oct 2023 18:18:39 GMT by Bella Boo
Sorry to interrupt but 2 (very salient I might add) points to make. 1) you can't just assign income if you want it to be effective for tax purposes. See this page: 2) form17 doesn't apply in Scotland because Scots law doesn't recognise the concept of legal and beneficial interests being held separately. This means in order to transfer 100% of the rental income to your wife, you would need to transfer (with your lender's agreement) 100% of the legal title/interest in the property.
Posted Sat, 28 Oct 2023 01:01:42 GMT by S0787571
The coat for transferring the title deed to my wife and buy to let mortgage product fees, are they deducted from year 1 rental income?
Posted Wed, 01 Nov 2023 10:20:00 GMT by HMRC Admin 25
Hi S0787571,
The cost for transferring the title deeds is not allowable as this will be taken into account for capital gains if/when the property is sold. the morrtgage fees are allowable and they come under resdiential property finance costs.
Thank you. 

Posted Wed, 01 Nov 2023 17:09:46 GMT by S0787571
Hi Admin 25, In that case as I am transferring the deed to my wife. I can't claim the original solicitor fees paid when I first bought this place. As between husband and wife there isn't any capital gain tax. Rite?
Posted Thu, 02 Nov 2023 15:04:51 GMT by HMRC Admin 25
Hi S0787571,
Thank you for your question.
You are correct, you would be unable to claim the solicitors’ fees when you bought the property to offset against rental income, however, if/when the property is later sold, then it may be claimed for Capital Gains Tax purposes.
Thank you. 

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