This topic contains 1 reply, has 1 voice, and was last updated by Patrick 19th February 2009 at 4:17 pm.
- 18th February 2009 at 10:14 am #364
my client, originally purchased a property in 1992 but was unable to secure a mortgage on it in her name. Her brother effectively acted as her bare trustee and held the property and the mortgage for the benefit of my client. Last year, my client and her brother fell out and things went to court, the judge ruled that my client was always the beneficial owner of the property and her brother had never had any beneficial interest.
My client paid the stamp duty on the purchase originally and also paid the mortgage on the property since it was taken out in 1992. After the court ruling, the original mortgage was redeemed and my client has now taken on a new mortgage. Her brother has been removed from the land registry etc.
My client has received an assessment from the Stamp Office, stating that as the legal charge has changed i.e. from her brother to her, SDLT is payable on the amount of the mortgage (c?550K). Is there any way around this problem, or are we stuck with the SDLT charge?
Any thoughts would be greatly appreciated.19th February 2009 at 4:17 pm #365
Without sight of the judgment and knowing the precise facts any view can only be provisional. However it seems to me that as your client already held the beneficial interest then the transfer to her of the legal interest from her bare trustee falls to be ignored under para 3(1) Sch 16 FA 2003 so no SDLT can arise even if she would otherwise be “assuming” a liability under para 8 Sch 4 FA 2003.