Cardiff conveyancing solicitor Archives - Page 14 of 14

Oct 19

Transfer of land is a lifetime gift to son

I own a large plot of land in West Wales which I want to share with my son. Do I need to re-register this or will it be seen by the taxman as a gift?

If you wish to transfer the plot into the joint names of yourself and your son, this is effectively a lifetime gift of one half of the value of the plot. Provided you live for seven years from the date of the gift, then the value of this gift will not be taken into account in the overall value of your Estate for Inheritance Tax purposes on your death.

However, your son will need to be aware of the possible charge to Capital Gains Tax in the event of the value of his one half share in the plot increasing substantially in future years.

In view of the fact that it is a lifetime gift, a transfer into your joint names will not attract Stamp Duty Land Tax even if the value of the one half of the plot exceeds £175,000. The gift by way of Transfer will then be registered by HM Land Registry in your joint names.

Oct 19

Apologise to seller – and walk away

My partner and I have made an offer on a house which has been accepted and we would due to exchange contracts next week. He has now said it is too soon for us to live together but I can’t afford to buy on my own. Can we walk away from this, or is it too late?

Fortunately, it is not too late as you may withdraw from any transaction prior to contracts being unconditionally exchanged. Despite you being virtually on the point of exchanging contracts, it is possible for either party to withdraw from the transaction. You are therefore free to withdraw without any obligation to indemnify the seller for any of his abortive costs or for inconvenience caused.

A late withdrawal like this often infuriates the innocent party as they have no recourse to make any claim for the recovery of their abortive costs. All you can do is apologise to the seller for your late withdrawal, which is due to a change in your personal circumstances which are clearly beyond your control.

Oct 19

Removing your ex from the house deeds

My wife and I have divorced and finally reached a financial settlement which includes me paying her off a share of our home. How do I remove her name from the house deeds?

If as a result of the financial settlement you have remortgaged the property to help raise the money to pay your ex-wife her share of the home, then the position is relatively simple, as during the process of remortgaging, the property will be transferred from your joint names into your sole name. The former joint mortgage will be repaid out of your new mortgage funds and the property ending up in your sole name.

It is essential that if you are paying, in addition to repayment of your joint mortgage, an additional capital sum to your ex-wife, that the consideration shown in the Transfer into your sole name is the total of the capital amount payable to your ex wife plus her one half share of the existing mortgage debt, which you are, effectively, absorbing.

If the combined total of this exceeds £175,000 then Stamp Duty Land Tax will be payable – unless the settlement is made the subject of a formal Court Order. However, if there were no additional capital payment to be made and you were simply absorbing the existing joint mortgage, then this could be done by way of a Transfer of Equity into your sole name, provided of course the existing Lender was happy to release your ex-wife from the joint mortgage and to transfer the mortgage into your sole name.

If the existing Lender is not prepared to do this, then you may be faced with having to remortgage with another Lender, taking out a new loan in your sole name which would complete simultaneously with the transfer of the property into your sole name.

Oct 19

Church bells may toll for country house-hunters

I am buying a house close to the Parish Church in a lovely Welsh Village. My solicitor tells me I may be asked at some stage to pay for repairs to the church. Is he joking?

Your solicitor is referring to the potential liability of occupiers to contribute towards the cost of repairs to the chancel of the local Parish Church. This has arisen as a result of a high profile case involving the Church of England.

The Church in Wales have formally responded to enquiries on this issue by stating that Chancel Repair Liability in Wales was not brought to an end on disestablishment. The Representative Body holds a certain amount of information, but it is insufficiently complete for them to be able to give a definite reply to any enquiry on potential liability and they advise that anyone having to address this issue may wish to consider whether it is more cost effective to simply seek insurance cover for a potential liability.

Solicitors have for some years advised clients that the likelihood of any contribution is extremely remote and that the decision was a Church of England one in any event and that the issue has not arisen in Wales. However, solicitors now have to carry out a Chancel search in all purchase transactions which may reveal that the property is located within the historical boundary of a tithe district within a parish which may continue to have a potential repair liability.

Unfortunately, there is no legislation clarifying the position and buyers are, therefore, left to decide for themselves as to how remote the likelihood of any liability is likely to be.