How to Transfer Ownership of House to Spouse

• It is common practise to transfer ownership of property to your wife or spouse, where it is advantageous from a tax perspective.
• If there is an existing mortgage, the transfer of property to your spouse may be liable for stamp duty tax.
• Certain transfers are also liable for Capital Gains Tax.
• If you are transferring equity as part of a divorce, the process is different.
• Tell us your goal, and a member of our transfer team will call you back to discuss your options, free of charge.

Many of our clients come to us with the same question: How do I add my wife to the deed of my house?. Whether you're looking to transfer property ownership to your spouse for tax purposes, or you need to for divorce proceedings, we've got you covered.

It's important to understand the difference between the legal owner of a property and who benefits from the property; such as property income or the right of use.

Legal Owner

The legal owner/s are registered at the Land Registry on the title deeds. You can have a maximum of 4 legal owners registered on the title and they have control over when the property is sold or transferred. Legal owners are also known as nominees or registered owners.

Beneficial Interest

This is "an interest in the economic benefit of property". Your beneficial ownership in the property reflects your share of any gain/loss from the property, including rent and profit/loss on sale.

You do not have to be a legal owner to be a beneficial owner. Many married couples share the beneficial interest with their partner but don't share the legal title because if they intend to share property income in a tax-efficient way, then there is no need to change the legal ownership.

How do I add my wife to the deed of my house?

There are many ways to transfer property to your wife/husband so they can get a share of the beneficial ownership. The process depends on whether:

• 1The property is in the sole name of one party.

• 2The property is owned jointly.

• 3The property has not been bought yet.

How to transfer property in your sole name

If you already own the property and it is in your sole name, then these are a few options to consider to transfer the beneficial interest to your spouse:

Transfer of Equity

In this scenario, the intention is to add the wife/husband to the deeds of the property as joint legal owners and to share the beneficial interest in unequal shares.

In most cases, the partner is transferred onto the legal title for zero consideration (no additional money changing hands) and at the end of the transfer you jointly own the legal and beneficial interest.

Deed of Trust

When sharing income from property in unequal shares, you are required to complete a Form 17 to HMRC and provide a Deed of Trust confirming the beneficial interest split between the joint owners.

If you fail to do this, HMRC presumes that income from property is shared equally between the joint owners.

A Deed of Trust will have clauses to include how the property is managed, lived in and possibly sold, however a deed of assignment assigns the beneficial interest from one party to the other. Both are deeds and can be used to assign a benefit in land to your spouse.

Extra considerations

Stamp Duty might be payable on a transfer between spouses, but it depends on the consideration. If there's cash being paid or a mortgage debt taken on in exchange for the transfer, stamp duty is payable.

Most mortgage lenders won't allow you to transfer beneficial interest to someone not a party to the mortgage. In these cases, you should look to assign the beneficial interest by using a deed of assignment instead.

Stamp Duty Land Tax (SDLT)

If you marry, enter into a civil partnership, or set up a home together, HMRC states: "You might pay SDLT when you transfer a share in a property to a husband, wife or partner when you do one of the following: marry, enter into a civil partnership, move in together".

The beneficial owner has no legal rights

Unless written into the Deed of Trust, the beneficial owner has no legal right to force the sale of the property, so they can receive their beneficial interest from a potential capital gain via sale.

The deed needs to be registered

A Deed of Trust needs to be registered with a Form B restriction placed over the title deeds at the Land Registry, to protect the non-legal owner from the property being sold without their knowledge.

How to transfer ownership if the property is owned jointly

Deed of Trust

Much like in the example above, a Deed of Trust can be used to declare an unequal beneficial interest between the joint owners.

Other than the ones raised above, an additional point to consider is if you currently own the property as Joint Tenants or Tenants in Common.

If you own the property as joint tenants, you'll need to sever the tenancy and change the ownership structure to tenants in common before you can register the Deed of Trust. You cannot own a property as joint tenants and have a Deed of Trust.

Transferring ownership if you haven't purchased the property yet

If you have yet to purchase the property, you can choose to buy the property as tenants in common and draft a Deed of Trust to reflect unequal shares in the property.

If your spouse is purchasing the property from you, you can do this via a Transfer of Equity or a standard sale and purchase transaction.

Got a question about transferring ownership of property?

Give us a call or send a message to request a free call back or an email from our transfer team. Whether you're adding or removing someone to or from the legal title, we'll answer your queries. We can also help if you want to assign the beneficial, not legal ownership, for income and tax purposes.

There's no obligation to instruct. We'll provide a free, fixed-fee quote for our best-value service to meet your needs. No robots, no call centres. Property challenges solved.

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