This only applies in the absence of a legal agreement or court injunction, such as divorce, dissolution, legal separation or annulment. Below are examples of when SDLT may or may not be due when transferring land or property to England and Northern Ireland. These are just a few examples of the complex SDLT problems that can arise in the event of separation or resolution. The extra tax to pay if the timing of events is wrong can be very important. If the value of each half of the country is the same, no SDLT is due. If real estate is transferred on the basis of a court order, SDLT should under no circumstances be paid. The same applies when it is translated into separation. If you or your clients are about to divorce or separate, contact Patrick Cannon to ensure that stamp duty deductibles are fully considered in the event of divorce, separation or termination of a life partnership and that any facilitation is invoked. Patrick can also discuss the consequences of capital gains tax. If you receive land or property under the terms of a will, you do not need to inform HMRC and you do not pay an SDLT. The same applies when you take out an unpaid mortgage on the property on the day of the person`s death. The prerequisite is that there is no other quid pro quo.
If a couple agrees to separate permanently, but without obtaining a court order, they are treated as an unmarried couple for DELT purposes. This means that for the purposes of the 3% allocation, each spouse can buy a house without being treated as the owner of property owned by the other spouse. This also means that transfers of ownership between them are exempt from stamp duty. However, a married couple who live together cannot buy any house without paying the 3% surcharge for at least one of them, with each spouse being treated for SDLT purposes as if they own dwellings owned by the other spouse. For more information on the impact of stamp duty on the transfer of ownership during divorce, click here. This article has discussed some of the most common tax considerations for couples considering separation, divorce or dissolution of a life partnership and, while this is not exhaustive, it should highlight the crucial importance of tax advice as soon as possible in order to avoid or mitigate negative tax consequences as much as possible. The stamp tax (SDLT) must be paid in the event of a taxable property transaction. You may have to pay SDLT if a share of land or ownership is transferred to you in whole or in part and you give in return something of monetary value. The transfer of a house or dwelling between spouse and wife or life partner is exempt from stamp tax (SDLT) in the event of divorce or separation, if the transfer is made on the basis of a court decision or an agreement between the couple in connection with the dissolution of their marriage or a separation order. In the case of a couple`s principal residence, the Principal Private Residence Relief (PPR) may be available to release earnings generated after the year of separation….