Due to changes in taxation on investment property, individuals are increasingly looking to transfer property into a company. This is not always a straightforward process. Here at CDS Mayfair we can inform and assist with commercial and residential properties:
- That are owned by one or more individuals
- The Stamp Duty Land Tax (SDLT) implications where the ownership of the property will differ to the ownership of the company.
- Documenting the transfer and filing the SDLT return.
SDLT is the biggest issue when it comes to transferring residential property to a corporate body such as a company or partnership also known as a ‘non-natural person’. Such entities purchasing residential property for more than £500,000 are charged at the 15% higher rate. If the property is worth between £40,000-£499,999 the higher SDLT rate of 3% will be applicable. The SDLT rates may change again in the future.
If residential property is owned by more than one individual and is transferred into a partnership SDLT relief may be applicable if a partnership is established and the transfer of ownership has effectively not changed when the property is later transferred into a company.
At CDS Mayfair we can advise on:
- the legal and beneficial interests in the property being held by the partners and shareholders of the partnership and setting up a partnership deed;
- the potential SDLT payable; and
- any reliefs that might apply
- the actual transfer of the property into a company.
This is most important when the shareholders in the partnership are different to the current property owners and when commercial property is involved.
CDS Mayfair are however not able to give financial advice.