Deed of Trust - Transferring Income to Spouse

Hello, I have a similar but slightly different situation to the one mentioned by Editrix above. I am sole owner of 2 BTL properties, each of which have a BTL mortgage. I am told that I can transfer the entitlement to 100% of the rental income for both properties to my spouse via a Declaration of Trust, and that thereafter, I would not include this income on my tax return and my spouse would include 100% of this income less the allowable related expenses. Can you confirm that this is permissible. Thanks,

Hi, Is it possible to set up a deed of trust that enables a family of siblings to jointly own a property?

Hi ,
 

If your actual beneficial interest in the property is formally changed through a declaration of trust so that you have 0% beneficial interest and your spouse has 100% beneficial interest, then you can ask to be taxed on that basis by sending a Form 17 declaration to HMRC with a copy of the declaration of trust as evidence.  The 0% / 100% split would only take effect from the date that the valid Form 17 declaration is signed by you and your spouse. A declaration of trust is a legally binding document that creates a trust. Most types of trusts giving an interest in property to somebody who is not the legal owner now need to be registered with HMRC via the Trust Registration Service. You can find guidance on the registration requirements and how to register here See: Register a trust as a trustee  . There’s also more information about what type of trusts need to be registered at see: Registration Service Manual     . Thank you .

Hi ,
 

Thank you for your question. Yes, it is possible to complete a Deed of Trust for siblings to jointly own a property. However, depending on the complexity of the terms of the Deed, legal advice may be advised. Thanks

Hi, As per some of the other cases, if I am the sole owner of a BTL property purchased before getting married (only my name on the land registry) with a mortgage in my name only at the moment, I can transfer beneficial interest to my wife by creating a deed of trust and informing the HMRC. My question is, do I create a deed of trust that reflects the exact ratio for both of us (90/10) and inform HMRC (without form 17) or do I need to create a 50/50 trust and then submit a form 17 to reflect the exact split? Furthermore, will a deed of trust trigger Capital Gains Tax or stamp duty given only my name is on the land registry and mortgage is currently in my name only? we’ve been married for over a decade. Many thanks

Hi ,

Thank you for your question.  You would create a deed of trust that reflects the exact ratio for both of you without th Form 17. If a property is held in the name of only one spouse the 50/50 and Form 17 rules do not apply, these rules only apply to property held in joint names. The deed of trust does not trigger Capital Gains. You will need to contact the Stamp Duty helpline on 0300 200 3510 for any queries regarding stamp duty. Thank you .