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SDLT - security as consideration?

Debt or security to count as consideration?

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Client is gifting property to his son. There is an outstanding debt secured on the property (but for a purpose unrelated to the property). Father and son have agreed (with the consent of the lender) that son will not assume the debt but he will grant security over the property. Does this grant of security constitute consideration for SDLT purposes?

Thanks in advance for all positive responses. To anyone that wants to carp about abuse of the anonymous feature, I suggest that you save your energy for something more constructive.

Reference the first comment below, my choice of words could perhaps have been better. In using "gift" I was referring to the fact that the father wishes to transfer the property to his son with nothing in return. Father will continue to pay off the loan, and it is the lender that requires the security. There might have been another (perhaps better) way of structuring arrangements but this is how they want to proceed. So, "outright" or not, the question is whether or not there will be any consideration chargeable to SDLT.

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By Justin Bryant
12th Oct 2020 17:29

It does not sound like an outright gift (of the net prevailing equity) if son is having to give security re the gift.

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By Wanderer
12th Oct 2020 17:36

Quote:
SDLT - security as consideration?
Debt or security to count as consideration?

Client is gifting property to his son. There is an outstanding debt secured on the property (but for a purpose unrelated to the property). Father and son have agreed (with the consent of the lender) that son will not assume the debt but he will grant security over the property. Does this grant of security constitute consideration for SDLT purposes?

Thanks in advance for all positive responses. To anyone that wants to carp about abuse of the anonymous feature, I suggest that you save your energy for something more constructive.

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