Husband and wife want to purchase properties as buy to lets from a company which they own; purchase to be partly funded with building society mortgage.
An opportunity to avoid SDLT by demonstrating that husband and wife are operating as partnership, me thinks! So perhaps we have partnership agreement, partnership name and bank account, business plan etc.
Unfortunately, building society refuse to lend to a partnership.
First thought is that this is the end of the road as far as SDLT planning, but then consider that even without above formalities still perfectly possible to have a partnership providing 1890 Act requirements satisfied.
This feels sneaky to me but surely partnerships must come into existence quite regularly in these circumstances without lender being aware.
And what about submitting SDLT return? If there is no formal partnership name does this make it more difficult for Revenue to accept Schedule 15 provisions apply?
You’re right in thinking that there are few formalities actually required for a general partnership and it would not be unusual for there to be a partnership in these circumstances. The problem is obviously the lender’s refusal to lend to a partnership which means that if you take the mortgage anyway you are likely to be obtaining the monies by deception – mortgage fraud in simple terms and so should not be seriously considered. Maybe go back to the lender and explain the (genuine) SDLT saving opportunity and see if they can accommodate your clients?