"Tenants in Common" - changing proportions of ownership

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Finances / Finanzen » uk.finance » "Tenants in Common" - changing proportions of ownership

"Tenants in Common" - changing proportions of ownership [message #390287]

So, 21 Mai 2006 16:25

gonzo

Hi

My wife and I own an investment property as "Tenants in Common", our
ownership being 80% vs 20%. We are about to sell this property, and need to
change the proportions by which we own it, in order to make best use of our
CGT allowance. Can I do this myself, or do I need to involve a solicitor /
notify the land registry etc? Witnesses? Would this be a "deed of
variation" or something?

The main issue is that my wife will have some more chargeable assets (total
value unknown) to dispose of during the current tax year, so the 'optimum'
proportions by which should own this property cannot be determined yet.
Ideally, we would prepare whatever documentation we need now, with today's
date, and then fill in the "%" figures next April, before we submit our tax
returns. We wouldn't be able to get away with doing this if the
documentation needs to be prepared by a solicitor...

Thanks for any advice.

Re: "Tenants in Common" - changing proportions of ownership [message #390288 ]

So, 21 Mai 2006 17:13

Ronald Raygun

Gonzo wrote:

> Hi
>
> My wife and I own an investment property as "Tenants in Common", our
> ownership being 80% vs 20%. We are about to sell this property, and need
> to change the proportions by which we own it, in order to make best use of
> our CGT allowance. Can I do this myself, or do I need to involve a
> solicitor / notify the land registry etc? Witnesses?

You can do it yourself, completely informally, and then give effect to
the decision by informing your tax office that you have done so, in what
proportions, and when.

> Would this be a "deed of variation" or something?

No. That's for wills.

> The main issue is that my wife will have some more chargeable assets
> (total value unknown) to dispose of during the current tax year, so the
> 'optimum' proportions by which should own this property cannot be
> determined yet. Ideally, we would prepare whatever documentation we need
> now, with today's date, and then fill in the "%" figures next April,
> before we submit our tax
> returns. We wouldn't be able to get away with doing this if the
> documentation needs to be prepared by a solicitor...

You don't need a solicitor, but it wouldn't hurt to consult an
accountant with experience in CGT minimisation.

The snag I foresee is that clearly you need to make the partial
ownership transfer between yourselves *before* you sell the property.

Logically you must decide how much to transfer before actually
transferring it, so I rather doubt whether you can "decide" the
proportion after the fact. Thus, if you don't inform HMRC of the
transfer (and hence of the proportion involved) prior to the sale
actually taking place, they may well be minded to ask embarrassing
questions.

Here's an alternative idea:

Transfer such proportion now as would make matters optimal if the
other assets were out of the picture.

Then have her transfer such share of the other assets, once their
value is known, to you just prior to their disposal, as would *then*
make for an optimal outcome.

Are you *sure* there is no alternative to disposing of both the
investment property and the other assets in the same tax year?

Is the investment property still going to be generating rental income
before selling arrangements are finalised? The rental business
profits are of course apportioned in your *income* (as opposed to
gains) tax return in the same proportion as your ownership, and if you
change those proportions, the apportionment of profits between date of
transfer and date of cessation of the rental business will need to
change. Sounds like there will be a lot of fun had with dealing with
intra-year accruals.

Re: "Tenants in Common" - changing proportions of ownership [message #390290 ]

So, 21 Mai 2006 19:32

gonzo

Thanks very much for the reply.

"Ronald Raygun" <no.spam [at] localhost.localdomain> wrote in message
news:as%bg.73040$wl.32253 [at] text.news.blueyonder.co.uk...
> Gonzo wrote:

>> My wife and I own an investment property as "Tenants in Common", our
>> ownership being 80% vs 20%. We are about to sell this property, and need
>> to change the proportions by which we own it, in order to make best use
>> of
>> our CGT allowance. Can I do this myself, or do I need to involve a
>> solicitor / notify the land registry etc? Witnesses?
>
> You can do it yourself, completely informally, and then give effect to
> the decision by informing your tax office that you have done so, in what
> proportions, and when.

OK, that's great. So is there any reason why I couldn't tell the tax office
when I
submit next years' form, that by the way we changed the proportion of
ownership of the property back in June 2006? If and when we do make the
change, there's nothing *concrete* to do, it's not as if she'd be writing me
a cheque representing the value of the difference.

>> The main issue is that my wife will have some more chargeable assets
>> (total value unknown) to dispose of during the current tax year, so the
>> 'optimum' proportions by which should own this property cannot be
>> determined yet. Ideally, we would prepare whatever documentation we need
>> now, with today's date, and then fill in the "%" figures next April,
>> before we submit our tax
>> returns. We wouldn't be able to get away with doing this if the
>> documentation needs to be prepared by a solicitor...
>
> You don't need a solicitor, but it wouldn't hurt to consult an
> accountant with experience in CGT minimisation.

We consulted the accountant about this before, which is why we originally
changed the property ownership to "Tenants in Common" a couple of years ago,
so we could do this sort of thing.

> The snag I foresee is that clearly you need to make the partial
> ownership transfer between yourselves *before* you sell the property.
>
> Logically you must decide how much to transfer before actually
> transferring it, so I rather doubt whether you can "decide" the
> proportion after the fact.

Logically? or do you mean "legally"?
Thus, if you don't
inform HMRC of the
> transfer (and hence of the proportion involved) prior to the sale
> actually taking place, they may well be minded to ask embarrassing
> questions.

What can they actually ask, though? Or are you saying that if they think
someone's trying to pull a fast one, then that person's tax return might
just get earmarked for "special attention"?!

> Here's an alternative idea:
>
> Transfer such proportion now as would make matters optimal if the
> other assets were out of the picture.
>
> Then have her transfer such share of the other assets, once their
> value is known, to you just prior to their disposal, as would *then*
> make for an optimal outcome.

That would certainly be the obvious solution, and we've looked into it but
it's related to her business and for various reasons her assets couldn't be
transferred to me.

> Are you *sure* there is no alternative to disposing of both the
> investment property and the other assets in the same tax year?

I wish. Various reasons for it though, too long and irrelevant to go into
here!

> Is the investment property still going to be generating rental income
> before selling arrangements are finalised? The rental business
> profits are of course apportioned in your *income* (as opposed to
> gains) tax return in the same proportion as your ownership, and if you
> change those proportions, the apportionment of profits between date of
> transfer and date of cessation of the rental business will need to
> change. Sounds like there will be a lot of fun had with dealing with
> intra-year accruals.

Think that should be OK, as there will have been no rental income during the
tax year 2005-06 (which coincides with our year-end from the lettings
viewpoint), so if we made the ownership transfer on say <ahem> 6 April 2006
it would all be pretty straightforward. I think.

Re: "Tenants in Common" - changing proportions of ownership [message #390291 ]

So, 21 Mai 2006 19:40

fjmd1a

Ronald Raygun wrote:
> Gonzo wrote:
>
> > Hi
> >
> > My wife and I own an investment property as "Tenants in Common", our
> > ownership being 80% vs 20%. We are about to sell this property, and need
> > to change the proportions by which we own it, in order to make best use of
> > our CGT allowance. Can I do this myself, or do I need to involve a
> > solicitor / notify the land registry etc? Witnesses?
>
> You can do it yourself, completely informally, and then give effect to
> the decision by informing your tax office that you have done so, in what
> proportions, and when.
>

Doesn't the transfer have to be in writing (since its a disposition of
property held under a trust), or have I got that wrong?

Francis

Re: "Tenants in Common" - changing proportions of ownership [message #390296 ]

So, 21 Mai 2006 20:56

Peter Crosland

> My wife and I own an investment property as "Tenants in Common", our
> ownership being 80% vs 20%. We are about to sell this property, and
> need to change the proportions by which we own it, in order to make
> best use of our CGT allowance. Can I do this myself, or do I need to
> involve a solicitor / notify the land registry etc? Witnesses? Would this
> be a "deed of variation" or something?
>
> The main issue is that my wife will have some more chargeable assets
> (total value unknown) to dispose of during the current tax year, so
> the 'optimum' proportions by which should own this property cannot be
> determined yet. Ideally, we would prepare whatever documentation we
> need now, with today's date, and then fill in the "%" figures next
> April, before we submit our tax returns. We wouldn't be able to get
> away with doing this if the documentation needs to be prepared by a
> solicitor...

It is too big a risk of incurring costs to rely on this or any other NG. Pay
a few hundred to a solicitor and regard it as insurance in case HM Revenue &
Customs don't accept it.

Peter Crosland

Re: "Tenants in Common" - changing proportions of ownership [message #390307 ]

Mo, 22 Mai 2006 00:02

Ronald Raygun

fjmd1a [at] gmail.com wrote:

>
> Ronald Raygun wrote:
>> Gonzo wrote:
>>
>> > Hi
>> >
>> > My wife and I own an investment property as "Tenants in Common", our
>> > ownership being 80% vs 20%. We are about to sell this property, and
>> > need to change the proportions by which we own it, in order to make
>> > best use of
>> > our CGT allowance. Can I do this myself, or do I need to involve a
>> > solicitor / notify the land registry etc? Witnesses?
>>
>> You can do it yourself, completely informally, and then give effect to
>> the decision by informing your tax office that you have done so, in what
>> proportions, and when.
>>
>
> Doesn't the transfer have to be in writing (since its a disposition of
> property held under a trust), or have I got that wrong?

It's just an inter-spouse transfer of beneficial interest. It doesn't
need to involve a disposition.

Re: "Tenants in Common" - changing proportions of ownership [message #390308 ]

Mo, 22 Mai 2006 00:52

Ronald Raygun

Gonzo wrote:

> "Ronald Raygun" <no.spam [at] localhost.localdomain> wrote in message
> news:as%bg.73040$wl.32253 [at] text.news.blueyonder.co.uk...
>>
>> The snag I foresee is that clearly you need to make the partial
>> ownership transfer between yourselves *before* you sell the property.
>>
>> Logically you must decide how much to transfer before actually
>> transferring it, so I rather doubt whether you can "decide" the
>> proportion after the fact.
>
> Logically? or do you mean "legally"?

I meant logically. If each of you owns different parts of the property,
and if each of you sells your part individually to the new buyer, then
surely there must be two contracts, one between the buyer and you for X%
of the property, and one between the buyer and your wife for Y% of the
property, where X+Y=100. The point is, though, that X and Y would need
to be specified in the contracts, and therefore prior to the date of
sale, and not later.

Legally, on the other hand, it might well be possible to circumvent
logic, by selling with a single contract in which you two declare that
between yourselves you do in fact own 100% of it, but without specifying
the actual split. If that's possible, it may well be possible to
do what you propose, i.e. to fix the proportions after the fact.

>> Thus, if you don't inform HMRC of the
>> transfer (and hence of the proportion involved) prior to the sale
>> actually taking place, they may well be minded to ask embarrassing
>> questions.
>
> What can they actually ask, though? Or are you saying that if they think
> someone's trying to pull a fast one, then that person's tax return might
> just get earmarked for "special attention"?!

You have the right to arrange your tax affairs to your advantage, but what
I'm not sure about is whether doing so retrospectively is lawful. If it is,
then you've nothing to worry about, but if it isn't, then they can ask
questions which will help them determine whether retrospection was involved.
If you notify them later of a split to the nearest tenth of a percent which
happens to optimise your position perfectly, it becomes a bit difficult to
defend the proposition that it was "just a lucky guess".

Re: "Tenants in Common" - changing proportions of ownership [message #390310 ]

Mo, 22 Mai 2006 01:39

john boyle

In message <za6cg.73323$wl.41060 [at] text.news.blueyonder.co.uk>, Ronald
Raygun <no.spam [at] localhost.localdomain> writes
>I meant logically. If each of you owns different parts of the property,
>and if each of you sells your part individually to the new buyer, then
>surely there must be two contracts, one between the buyer and you for X%
>of the property, and one between the buyer and your wife for Y% of the
>property, where X+Y=100. The point is, though, that X and Y would need
>to be specified in the contracts, and therefore prior to the date of
>sale, and not later.
>
>Legally, on the other hand, it might well be possible to circumvent
>logic, by selling with a single contract in which you two declare that
>between yourselves you do in fact own 100% of it, but without specifying
>the actual split. If that's possible, it may well be possible to
>do what you propose, i.e. to fix the proportions after the fact.
It is possible, in fact it is the norm. The 'in common' bit is of no
consequence to the sale contract or the purchaser. The concept of the
ownership being 'in common' isnt reflected in the sale documents. The
'in common' is solely a matter between X & Y. (All assuming English
rules of course).

>>> Thus, if you don't inform HMRC of the
>>> transfer (and hence of the proportion involved) prior to the sale
>>> actually taking place, they may well be minded to ask embarrassing
>>> questions.
>>
>> What can they actually ask, though? Or are you saying that if they think
>> someone's trying to pull a fast one, then that person's tax return might
>> just get earmarked for "special attention"?!
>
>You have the right to arrange your tax affairs to your advantage, but what
>I'm not sure about is whether doing so retrospectively is lawful.

Dont know about this but though.

--
John Boyle

Re: "Tenants in Common" - changing proportions of ownership [message #390311 ]

Mo, 22 Mai 2006 10:30

fjmd1a

Ronald Raygun wrote:

>
> It's just an inter-spouse transfer of beneficial interest. It doesn't
> need to involve a disposition.

I thought all transfers of the beneficial interest were dispositions,
is there a specific exception for spouses (I don't yet do any family
law, so haven't dealt with this kind of thing).

Francis

Re: "Tenants in Common" - changing proportions of ownership [message #390313 ]

Mo, 22 Mai 2006 11:18

Ronald Raygun

fjmd1a [at] gmail.com wrote:

> Ronald Raygun wrote:
>>
>> It's just an inter-spouse transfer of beneficial interest. It doesn't
>> need to involve a disposition.
>
> I thought all transfers of the beneficial interest were dispositions,
> is there a specific exception for spouses (I don't yet do any family
> law, so haven't dealt with this kind of thing).

It's not a question of either family law or contract law, but of tax law.

A disposition is a formal conveyance of title in an asset, usually but
not necessarily in consideration of money paid. In other words it
transfers legal or "paper" ownership.

A transfer of beneficial interest in an asset, on the other hand, is
possible without transferring title, in which case it is purely an
assignment for tax purposes, i.e. it transfers the right to income
or gain deriving from the asset, and therefore the liability to be
taxed thereon.

In tax law a transfer of beneficial interest gives rise to a liability
to CGT if applicable, but not if the transfer is between spouses.

Re: "Tenants in Common" - changing proportions of ownership [message #390330 ]

Mo, 22 Mai 2006 15:52

fjmd1a

Ronald Raygun wrote:

> It's not a question of either family law or contract law, but of tax law.

I was thinking of the provisions of section 53(1)(c) of the Law of
Property Act 1926 that "a disposition of an equitable interest or trust
subsisting at the time of the disposition, must be in writing signed by
the person disposing of the same, or by his agent thereunto lawfully
authorised in writing or by will".

In this case, both parties hold an interest under a trust of land. The
transfer of the equitable interest of one to the other is (surely) a
disposition under s53, or do you know something I don't?

>
> A disposition is a formal conveyance of title in an asset, usually but
> not necessarily in consideration of money paid. In other words it
> transfers legal or "paper" ownership.

Nope. That can't be right. s53 clearly applies to equitable interests
as well as legal ones.

>
> A transfer of beneficial interest in an asset, on the other hand, is
> possible without transferring title, in which case it is purely an
> assignment for tax purposes, i.e. it transfers the right to income
> or gain deriving from the asset, and therefore the liability to be
> taxed thereon.
>
> In tax law a transfer of beneficial interest gives rise to a liability
> to CGT if applicable, but not if the transfer is between spouses.

Yes, as a matter of tax law, maybe. But what I am concerned about is
whether the transfer will be effective at all.

Francis

Re: "Tenants in Common" - changing proportions of ownership [message #390345 ]

Mo, 22 Mai 2006 17:09

Ronald Raygun

fjmd1a [at] gmail.com wrote:

>
> Ronald Raygun wrote:
>
>> It's not a question of either family law or contract law, but of tax law.
>
> I was thinking of the provisions of section 53(1)(c) of the Law of
> Property Act 1926 that "a disposition of an equitable interest or trust
> subsisting at the time of the disposition, must be in writing signed by
> the person disposing of the same, or by his agent thereunto lawfully
> authorised in writing or by will".
>
> In this case, both parties hold an interest under a trust of land. The
> transfer of the equitable interest of one to the other is (surely) a
> disposition under s53, or do you know something I don't?

I don't think property law is relevant here, because there *is no*
disposition of equitable interest, there is *only* transfer of
beneficial interest.

>> A disposition is a formal conveyance of title in an asset, usually but
>> not necessarily in consideration of money paid. In other words it
>> transfers legal or "paper" ownership.
>
> Nope. That can't be right. s53 clearly applies to equitable interests
> as well as legal ones.

I can only assume that you are erroneously conflating "beneficial" and
"equitable", for I think they are not the same thing at all. Remember
that the intention here is not that one of the co-owners wishes to
dispose of (part of his share of) the property to the other co-owner,
but only of the right to derive a share of the income/gain from it.

In other words, he is in effect transferring (gifting) a share of
the income and/or gain from the property, and not a share of the
property itself. The result is that this income or gain will be
taxed as the transferee's instead of the transferor's.

>> In tax law a transfer of beneficial interest gives rise to a liability
>> to CGT if applicable, but not if the transfer is between spouses.
>
> Yes, as a matter of tax law, maybe. But what I am concerned about is
> whether the transfer will be effective at all.

What do you mean by effective? The issue here is only whether it is
effective for the purpose of transferring tax liability, and not for
any other purpose, such as that of transferring the right to dispose
of title to part of the property in favour of a third party.

Re: "Tenants in Common" - changing proportions of ownership [message #390350 ]

Mo, 22 Mai 2006 18:07

fjmd1a

Ronald Raygun wrote:

>
> I don't think property law is relevant here, because there *is no*
> disposition of equitable interest, there is *only* transfer of
> beneficial interest.
>

No. Transfer of a beneficial interest is a disposition, "disposition"
is construed widely, see Gray v IRC [1958[ Ch 690.

>
> I can only assume that you are erroneously conflating "beneficial" and
> "equitable", for I think they are not the same thing at all. Remember

Beneficial interest and equitable interest mean the same thing. Its a
shame that the terminology is confusing. One can have two kinds of
interest in property: legal ones, and equitable ones. The latter are
referred to as "beneficial interests" as the beneficiary has the right
to benefit from the property whereas the legal owner (the trustee) does
not.

I thought that the tax law meaning of beneficial interest was the same
as the law of property one (whereas, the meaning of "settlement" is, I
understand, different for instance).

> that the intention here is not that one of the co-owners wishes to
> dispose of (part of his share of) the property to the other co-owner,
> but only of the right to derive a share of the income/gain from it.
>

Ah, I had missed that in the tax planning. I suppose that would be a
declaration of trust (of his equitable interest) in favour of his wife
so that she took the income, but no more (is the property supposed to
revert back to him at some point)? If that's right, then writing
wouldn't be needed.

> In other words, he is in effect transferring (gifting) a share of
> the income and/or gain from the property, and not a share of the
> property itself. The result is that this income or gain will be
> taxed as the transferee's instead of the transferor's.

Right, so he is holding part of his share on trust for her? Is that how
it works?

>
> What do you mean by effective? The issue here is only whether it is
> effective for the purpose of transferring tax liability, and not for
> any other purpose, such as that of transferring the right to dispose
> of title to part of the property in favour of a third party.

Well, I would be surprised if it could be effective for one and not the
other. Even so, other parties may become interested (on bankruptcy or
death) so it is important to know what interest both parties have.

What you are suggesting sounds rather compliacted to be done orally by
the way.

Francis

Re: "Tenants in Common" - changing proportions of ownership [message #390351 ]

Mo, 22 Mai 2006 18:11

fjmd1a

Ronald Raygun wrote:

> In other words, he is in effect transferring (gifting) a share of
> the income and/or gain from the property, and not a share of the
> property itself. The result is that this income or gain will be
> taxed as the transferee's instead of the transferor's.
>

Sort of made sense, but your first reply to the OP was:

Ronald Raygun wrote:
> Gonzo wrote:
>
> > Hi
> >
> > My wife and I own an investment property as "Tenants in Common", our
> > ownership being 80% vs 20%. We are about to sell this property, and need
> > to change the proportions by which we own it, in order to make best use of
> > our CGT allowance. Can I do this myself, or do I need to involve a
> > solicitor / notify the land registry etc? Witnesses?
>
> You can do it yourself, completely informally, and then give effect to
> the decision by informing your tax office that you have done so, in what
> proportions, and when.

It *sounds* like you are talking about transfering part of his
beneficial interest to her (i.e. so that their ownership as equitable
tenants in common is altered -- which is what the OP was asking about).
So now I am confused.

Francis

Re: "Tenants in Common" - changing proportions of ownership [message #390353 ]

Mo, 22 Mai 2006 18:52

Ronald Raygun

fjmd1a [at] gmail.com wrote:

>> I can only assume that you are erroneously conflating "beneficial" and
>> "equitable", for I think they are not the same thing at all. Remember
>
> Beneficial interest and equitable interest mean the same thing.

I don't think it can be as simple as that. Beneficial interest includes
the right to "use". In the case of a property being rented by joint (or
in common) owners to a tenant, the tenant has, for the duration of the
tenancy, beneficial interest in the property in the form of an exclusive
right to occupy the property as his residence. Meanwhile, the owners
share the rental income in some proportion, usually in the proportion of
their equitable interest in the property. No?

Perhaps we need an extra level of what the interest is in. Can there be
a beneficial interest in the income from the property as distinct from a
beneficial interest in the property itself?

>> that the intention here is not that one of the co-owners wishes to
>> dispose of (part of his share of) the property to the other co-owner,
>> but only of the right to derive a share of the income/gain from it.
>
> Ah, I had missed that in the tax planning. I suppose that would be a
> declaration of trust (of his equitable interest) in favour of his wife
> so that she took the income, but no more (is the property supposed to
> revert back to him at some point)? If that's right, then writing
> wouldn't be needed.

OK, there we are, then. I think it's even weaker than that, it's not
an irrevocable giving away of a right to income, but more like an
understanding that income itself will be given away until further notice.

> What you are suggesting sounds rather compliacted to be done orally by
> the way.

"From now on, Dear, I want you to have two thirds of the rental income,
until I say otherwise" doesn't sound very complicated, yet expresses in
pretty unequivocal terms that neither is the ownership proportion being
altered, nor is the arrangement permanent, nor even capable of being
enforced.

Re: "Tenants in Common" - changing proportions of ownership [message #390354 ]

Mo, 22 Mai 2006 19:08

Ronald Raygun

fjmd1a [at] gmail.com wrote:

> Ronald Raygun wrote:
>
>> In other words, he is in effect transferring (gifting) a share of
>> the income and/or gain from the property, and not a share of the
>> property itself. The result is that this income or gain will be
>> taxed as the transferee's instead of the transferor's.
>
> Sort of made sense, but your first reply to the OP was:
>
>> Gonzo wrote:
>> >
>> > My wife and I own an investment property as "Tenants in Common", our
>> > ownership being 80% vs 20%. We are about to sell this property, and
>> > need to change the proportions by which we own it, in order to make
>> > best use of
>> > our CGT allowance. Can I do this myself, or do I need to involve a
>> > solicitor / notify the land registry etc? Witnesses?
>>
>> You can do it yourself, completely informally, and then give effect to
>> the decision by informing your tax office that you have done so, in what
>> proportions, and when.
>
> It *sounds* like you are talking about transfering part of his
> beneficial interest to her (i.e. so that their ownership as equitable
> tenants in common is altered -- which is what the OP was asking about).
> So now I am confused.

I see what you mean. I think there is still something missing here,
and that there is more to it than that 1926 section 53 you mentioned.
Equitable interest can change other than by disposition, such as by
virtue of contributions being made by the individual co-owners. Where
they have made unequal contributions to the purchase deposit, for instance,
or to the mortgage loan interest and repayments, their equitable and
beneficial interest will be unequal due to those facts. If one of them
has put up most of the deposit but the other is making most of the
payments, their equitable interest will be changing all the time
despite there being no dispositions in sight.

Re: "Tenants in Common" - changing proportions of ownership [message #390413 ]

Mi, 24 Mai 2006 00:34

gonzo

"Ronald Raygun" <no.spam [at] localhost.localdomain> wrote in message
news:temcg.73649$wl.4571 [at] text.news.blueyonder.co.uk...
> fjmd1a [at] gmail.com wrote:
>
>> Ronald Raygun wrote:
>>
>>> In other words, he is in effect transferring (gifting) a share of
>>> the income and/or gain from the property, and not a share of the
>>> property itself. The result is that this income or gain will be
>>> taxed as the transferee's instead of the transferor's.
>>
>> Sort of made sense, but your first reply to the OP was:
>>
>>> Gonzo wrote:
>>> >
>>> > My wife and I own an investment property as "Tenants in Common", our
>>> > ownership being 80% vs 20%. We are about to sell this property, and
>>> > need to change the proportions by which we own it, in order to make
>>> > best use of
>>> > our CGT allowance. Can I do this myself, or do I need to involve a
>>> > solicitor / notify the land registry etc? Witnesses?
>>>
>>> You can do it yourself, completely informally, and then give effect to
>>> the decision by informing your tax office that you have done so, in what
>>> proportions, and when.
>>
>> It *sounds* like you are talking about transfering part of his
>> beneficial interest to her (i.e. so that their ownership as equitable
>> tenants in common is altered -- which is what the OP was asking about).
>> So now I am confused.
>
> I see what you mean. I think there is still something missing here,
> and that there is more to it than that 1926 section 53 you mentioned.
> Equitable interest can change other than by disposition, such as by
> virtue of contributions being made by the individual co-owners. Where
> they have made unequal contributions to the purchase deposit, for
> instance,
> or to the mortgage loan interest and repayments, their equitable and
> beneficial interest will be unequal due to those facts. If one of them
> has put up most of the deposit but the other is making most of the
> payments, their equitable interest will be changing all the time
> despite there being no dispositions in sight.

*You guys* are confused.... you made my head spin! :-)

FWIW, we exchanged contracts today. It was of no relevance what proportions
me and the missus owned the property, we simply signed the contract as
co-owners, end of story.

In the end we ran the change of relative ownership past our accountant - he
said he knew nothing about the mechanics if it, it was just a legal thing,
ask the solicitor. She didn't seem particularly clued up about it, and told
us we had to register the change with the land registry and better get on
with it pronto! so we selected our percentages yesterday and went with it.
I'm not impressed - I do believe Mr Raygun is correct above but it's hard
to contradict your so-called expert, paid-for advisors using info gained
"from some bloke on the internet" ! For my own sanity I'd very much like to
find a citable source which confirms Ron's correct - not least because no
doubt a bill is on the way for the extra legal work, and I'd like to know
whether it's time I found a new lawyer...

Thanks
Gonzo

Vorheriges Thema:	Cash ISA
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