Allocation of Income from Property

Declaration of Trust Deed

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I have a client who is a 40% Tax Payer.  His wife is a very low basic rate payer.  He has asked a solicitor to draw up a Decalaration of Trust Deed alloccating 100% of the property rental income and expenses to his wife.  Effective date of signing of this deed was 29/03/2019.  Previously the property was solely owned by the husband.  I asked him to confirm with his solicitor could this deed be treated as been back dated for the whole of the tax year 2018/2019.  His solicitors response was to speak to me or was there anybody else that could advise - hence my callout to this community.  In conclusion can anyone confirm if a Declaration of Trust Deed can be treated as being backdated?

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By Accountant A
25th Apr 2019 16:22

When was the Form 17 submitted?

You say "Previously the property was solely owned by the husband". When was a part share transferred to the spouse?

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Replying to Accountant A:
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By peter.peterchalkco.co.uk
25th Apr 2019 16:22

I totally agree with your first comment.
Form 17 has not been submitted as it is a new client to me.
Share transferred to wife within the Declaration of Trust

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Replying to peter.peterchalkco.co.uk:
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By Accountant A
25th Apr 2019 16:44

peter.peterchalkco.co.uk wrote:

Form 17 has not been submitted as it is a new client to me.

In which case (subject to the below) what purpose could backdating the DoT serve even assuming it was legal?

peter.peterchalkco.co.uk wrote:

Share transferred to wife within the Declaration of Trust

So the property remains wholly owned by the husband? In which case, I didn't think you can do what you are trying to do.

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By Justin Bryant
25th Apr 2019 16:38

I am quite frankly shocked that the solicitor is unaware that backdating a deed is illegal and would be fraudulent tax evasion in this case.

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Replying to Justin Bryant:
By johngroganjga
25th Apr 2019 16:44

It hasn’t been backdated. I suggest you read the question again. The question is whether it can be treated as being effective before it was signed and executed.

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Replying to johngroganjga:
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By Justin Bryant
25th Apr 2019 18:23

It does not say the deed is to be physically dated 29.3.19 (or later) and in any event clearly it cannot otherwise be treated as backdated if previous to that it was solely owned by H.

"Effective date of signing of this deed was 29/03/2019. Previously the property was solely owned by the husband. I asked him to confirm with his solicitor could this deed be treated as been back dated for the whole of the tax year 2018/2019. "

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By JD
28th Apr 2019 21:29

Who's name is the mortgage in and would the interest still be allowable against the wife's portion of rental income.

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