Gift of property to wife

Gift of property to wife

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If a husband gifts half a property to his wife (he previously had title to 100%) what needs to happen to satisfy answers from I.Revenue at a later date ?
There is a small mortgage attached (£110k) to the property which is a holiday home investment.
Should they change the deeds or simply lodge a letter with the I.R regarding the gift.

Ben

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By michaelblake
03rd Aug 2004 17:20

Conditions for a gift to be valid
There are a number of features that have to be present before a gift is valid in law. These are;

1. Donative intent i.e. an intention to give

2. Completion of the correct formalities, or delivery if the item gifted is capable of delivery.

3. An acceptance of the gift by the donee.

As far as I understand it in English Law transfers of land must be by deed. A transfer which is not by deed acheives nothing. An exchange of letters between the spouses would therefore not be sufficient to establish a valid gift.

It would not be essential, but may be desirable, to change the title to the property at the Land Registry.

If the transfer is effected with the mortgage attached i.e. a share of the mortgage is transferred as well as a share in the property you may wish to check whether there would be a stamp duty land tax liability in relation to the value of the mortgage transferred (although this may not be an issue if the amount transferred is below £60,000).

The gift should be recorded on the husbands tax return for the relevant year but nothing needs be sent to the Revenue as proof of the gift unless they enquire into the return and ask for it.

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