I have a client who owns 2 rental properties with her (now ex) husband.
She wants to buy him out with her new partner then being joint owner of the 2 properties with her.
If both properties were transferred into an LLP, from what I know (I have limited knowledge on LLP's) she wouldn't pay any SDLT/CGT on the transfer as her ownership remains the same, as an individual, and she would then still get taxed, at basic rate, on her rental income.
However what happens regarding the new partner and SDLT? I'm assuming he'd still have to pay this on his share of the property at market value?
So would there be any benefit at all to setting up a LLP for these 2 properties or not and just own as partners?
I have calculated the tax due if they set up a Ltd Co and transferred into them but with CGT and also the Ltd Co having to pay SDLT on the total cost of both properties, its looking better not incorporating.
Thanks in advance