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Hello, I would be grateful for your advice,
Person A owns a house that has no mortgage. It is let to tenants. Person A plans on transferring 50% of the ownership of the house to a family member- Person B (who is not a partner / spouse) without there being any transfer of money (so like a gift). If possible their preference is that Person A keeps receiving all of the rent but if the house is sold then Person B receives 50% of the sale proceeds.
Please can you guide on the below topics?
1. Would it be better to divide the ownership as Joint Tenants or Tenants in Common, from a practical point of view?
2. Will the part transfer mean that the policyholder on the insurance policies on the house will also need to see a change from one to two? Or can Person A remain sole policyholder?
3. Does the tenancy agreement with the tenant need to change to include the new co-owner Person B also as a co-landlord? Is this necessary if Person B is happy for Person A to continue to receive the full rent and to manage the tenancy aspect?
4. If Person A pays tax on the rental income received from the property do they need to inform the HMRC, about the ownership change (when there is no actual change to the rental income received)? Does Person B need to inform the HMRC, if they are not receiving any income?
5. Assuming this arrangement can take place and the title deeds are amended following the conveyancing process, is that sufficient to document each party's share of 50% or is anything else needed? For example, a document signed by the two parties stating they agree for this change to take place?
6. Would this arrangement mean that once the title deeds are amended to include Person B’s ownership, that their right to owning 50% is established, and upon sale of the house they will be entitled to their 50% share?
7. Is there anything else that you think should be done from the formality point of view in this process?
Thank you for your help with this.
Person A owns a house that has no mortgage. It is let to tenants. Person A plans on transferring 50% of the ownership of the house to a family member- Person B (who is not a partner / spouse) without there being any transfer of money (so like a gift). If possible their preference is that Person A keeps receiving all of the rent but if the house is sold then Person B receives 50% of the sale proceeds.
Please can you guide on the below topics?
1. Would it be better to divide the ownership as Joint Tenants or Tenants in Common, from a practical point of view?
2. Will the part transfer mean that the policyholder on the insurance policies on the house will also need to see a change from one to two? Or can Person A remain sole policyholder?
3. Does the tenancy agreement with the tenant need to change to include the new co-owner Person B also as a co-landlord? Is this necessary if Person B is happy for Person A to continue to receive the full rent and to manage the tenancy aspect?
4. If Person A pays tax on the rental income received from the property do they need to inform the HMRC, about the ownership change (when there is no actual change to the rental income received)? Does Person B need to inform the HMRC, if they are not receiving any income?
5. Assuming this arrangement can take place and the title deeds are amended following the conveyancing process, is that sufficient to document each party's share of 50% or is anything else needed? For example, a document signed by the two parties stating they agree for this change to take place?
6. Would this arrangement mean that once the title deeds are amended to include Person B’s ownership, that their right to owning 50% is established, and upon sale of the house they will be entitled to their 50% share?
7. Is there anything else that you think should be done from the formality point of view in this process?
Thank you for your help with this.
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