In 2010, I married my wife and moved in to her flat with her - which she has owned since autumn 1999.
We lived there until early 2012, when we purchased a new home. To expedite the sale, we retained the flat and prepared it for letting. From April 2012 we have had tenants in the flat.
Unfortunately we didn't think to transfer the flat into joint names while we were still living there, and currently it is still in my wife's name only.
(We have no mortgage on the flat, but we do have a mortgage on our current residence.)
1. Is there any way now that I can inherit or have a share in my wife's Private Residence Relief for CGT purposes? (That is, apart from moving back in to the flat at some future time - which we don't want to do.)
2. If I don't qualify for Private Residence Relief on the flat, could I still claim Letting Relief against CGT because it was for a while my main residence, or is Letting Relief only applicable for those who are eligible for Private Residence Relief?
3. I currently have almost no income, but my wife is a basic rate tax payer, and at present all the income from the flat is taxable as her income. What can we do so as to use my tax allowance against the rental income from the flat, while not impacting too much on future CGT liability if we need to sell?
I am not very well-versed in tax issues. Would either of these work, and if so which would be best?
Can anything be done retrospectively for the income from 2012-3, or for the income to date in the current tax year:
-> "A declaration of Trust". I don't understand how this works.
- Would this suit our needs?
- Is this completely separate from transferring ownership and with no CGT impact?
- Could this be set up retrospectively in any way?
- Where can I read more about this?
-> My wife could pay me to manage the property. This sounds nice and simple.
- Any downsides?
- Would HMRC accept that £5k per year was a fair payment for this work for one property, or might they object?
- Could this be set up retrospectively in any way?
We lived there until early 2012, when we purchased a new home. To expedite the sale, we retained the flat and prepared it for letting. From April 2012 we have had tenants in the flat.
Unfortunately we didn't think to transfer the flat into joint names while we were still living there, and currently it is still in my wife's name only.
(We have no mortgage on the flat, but we do have a mortgage on our current residence.)
1. Is there any way now that I can inherit or have a share in my wife's Private Residence Relief for CGT purposes? (That is, apart from moving back in to the flat at some future time - which we don't want to do.)
2. If I don't qualify for Private Residence Relief on the flat, could I still claim Letting Relief against CGT because it was for a while my main residence, or is Letting Relief only applicable for those who are eligible for Private Residence Relief?
3. I currently have almost no income, but my wife is a basic rate tax payer, and at present all the income from the flat is taxable as her income. What can we do so as to use my tax allowance against the rental income from the flat, while not impacting too much on future CGT liability if we need to sell?
I am not very well-versed in tax issues. Would either of these work, and if so which would be best?
Can anything be done retrospectively for the income from 2012-3, or for the income to date in the current tax year:
-> "A declaration of Trust". I don't understand how this works.
- Would this suit our needs?
- Is this completely separate from transferring ownership and with no CGT impact?
- Could this be set up retrospectively in any way?
- Where can I read more about this?
-> My wife could pay me to manage the property. This sounds nice and simple.
- Any downsides?
- Would HMRC accept that £5k per year was a fair payment for this work for one property, or might they object?
- Could this be set up retrospectively in any way?