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I will soon be starting in a new job which takes me literally right onto the 40% tax threshold.
Meaning my property income will come into s24 territory.
I currently own 2 buy to let properties as tenants in common with my partner (we are unmarried) of which we apportion rent received as we see fit for tax purposes, she is a lower rate tax payer so will be taking on the majority of work, income and tax regarding these two when I begin my new job.
I also own another property as tenants in common with a friend, 50% each. This is where my dilemma lies.
My question is how can I transfer my 50% of that property to my partner so she can pay tax on it.
Thank you in advance
Do you mean new salary goes to the 2019/2020 50k threshold?
Are the properties you want to transfer mortgaged?
Yes new salary will be right on the limit for 19/20 so all property income will be taxed at 40% plus.
All properties are mortgaged but it's just the one owned with my friend that is an issue I think.
I could make extra pension contributions I suppose but would prefer to transfer the share of the property.
Surely it is not just salary? But a combination of salary AND turnover from your 2x 50% shares in both properties?
Talk to a good tax adviser first before doing anything. Tranfer of property could incur liability for capital gains tax and stamp duty. Not sure if transfers to partners same as between marries couples.
Transfer also means giving up ownership - albeit maybe in exchange for a monetary consideration from recipient - that warrants serious consideration.
You will be giveing ownership to another person and your not married so you will create a tax bill one way or another
you need professional advice
you could be jumping out of the frying pan into a fire
have you thought about useing a pension to mop up higher rate tax
itwirks well and it’s a lot less cost than transferring owner ship
Learn Change and Adapt ?????
All comments are for casual information purposes only. If you wish to rely on any advice I have given please ensure you obtain independent specialist advice from a third party. No liability is accepted for comments made.
Yes quite happy to transfer the ownership, that's what I want to do, and generate the tax liability in my partner's name.
Pensions is an option that I may have to resort to but not my preference in this matter.
Agreed pension option will tie up the money until age 55 - and partner also needs tax advice on the whole issue