Is there a stamp duty liability if I add my partner to the mortgage?

Posted on 19 July 2007

I have a mortgage on my current home that is in my name alone. I would like to add my partner onto the mortgage, as he has been contributing to it for many years. I asked Halifax, my current lender, how to do this - they said I should just fill in a form at a branch. A friend mentioned that this might mean we have to pay stamp duty. I asked Halifax and they could not help. Do you know where I can get a definitive answer on this? Clearly I could not be charging him anything for that! Would be grateful for any pointers.

David
 

Hello David,

The mortgage part of this is as straight forward as the Halifax suggests.  if you want to add someone to the mortgage you simply fill in a form as if you were doing a remortgage and they will do credit searches on the second person then add him on.  However, your issue arises with the actual ownership of the property as your partner cannot be party to a mortgage on a property unless he part owns that property.  Your solicitor will be able to transfer half of the property into his name by just getting you both to sign a contract. However, this counts as him buying half of it from you: hence the stamp duty. 
 
I am not a tax advisor so unfortunately I am not legally able to give you a definitive answer on this so you need to speak to your solicitor. 
 
I can share with you, however, my own understanding of it, which is that the half of the property that you are selling him needs to be worth over £120,000 for it to be liable for stamp duty. As long as your property is worth less than £240,000 you should be alright. I understand that other factors are taken into account so please ask your solicitor to confirm all of this for you.
 
Regards,

Katie

Categories: Tax issues

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