If your living arrangements have changed and you find yourself wondering ‘how do you transfer part of equity’ read on, as this week Prestige Tax and Trust Services explains how to transfer part of equity.
The Evolution of the Family
As your life passes by, the composition of your family will change. Where once, you considered your family to be composed of you and your parent(s), one day you may add a spouse, children or even grandchildren.
As your family evolves, you may need to ensure that the new family member receives part ownership of your home. To do so effectively, you’ll need to transfer part of the equity of your home. This is where a party is added to or taken away from the deed for your property.
How to Transfer Part of Equity
If there is no mortgage on the home, the process is relatively simple and involves two steps. The first step involves transferring ownership of your property. To do so, you will need to go through the conveyancing process.
Secondly, you will need to register your property with the land registry, as legally they need to be notified of the change. As your property is already registered, the process is relatively simple. Go through the same transfer of ownership process as you would when buying a house that is already registered, except instead of completing a transfer of whole of registered property title, complete a transfer of part of registered title.
If you’re looking to transfer part of equity on a property with a mortgage, the process is a little more complex. You also have to receive permission from the mortgage provider. Essentially, this is because the names on the mortgage deed will have to be the same as the names on the transfer deed.
Will You Need to Pay Stamp Land Duty Tax?
Aside from what’s laid out above, there is one other major consideration you may need to make whilst transferring part of equity. Will you need to pay any Stamp Land Duty Tax (SLDT)?
UK law requires you to pay SLDT if you buy a property that’s worth more than £125,000. Therefore, if you transfer £90,000 of equity, no SLDT is required, because it’s below the £125,000 threshold. Yet if you transfer £150,000 worth of equity, SLDT is payable, as it stands above the current £125,000 threshold. Either way, you must notify HM Revenue and Customs of the transaction on an SLDT Return.
Let Prestige Tax and Trust Services Lend a Helping Hand
Transferring part of equity is a complex legal process with a series of steps to complete. In order to ensure you transfer part of equity effectively, let Prestige Tax and Trust Services lend a helping hand. We have the legal transfer of equity expertise you need to transfer part of the equity of your home.