Do you own your property jointly with your spouse, friend, partner or anyone and wish to change this situation? Many clients have asked about this over the year.
Changing the ownership of a property does not always have to be done as a purchase of a share and a sale of a share. There is a way of dividing joint property ownership allowing joint owners to let one or more owners off the deeds in a tax-efficient manner as it enables the outgoing joint owner or owners to transfer their share to the existing joint owner legally avoiding the usual Transfer Tax.
Stamp duty has to be paid but it is much lower than the usual transfer tax, plus the ordinary notary, land registry and legal fees. If the vendor is non-resident, 3% of the outgoing share is retained in case of capital gains tax being applicable.
The most common enquiry regarding this procedure is when a couple´s marriage or relationship come to an end and they decide that only one of them wishes to keep the property in their name.
Sometimes we receive enquiries from two couples, one of whom is no longer interested in the property. In this case, one couple can opt out, but only one person can remain on the deeds to allow us to use this procedure.
On other occasions, someone having financial difficulties might prefer to have assets removed from their name if possible, but this should be discussed with us.
What happens with a Mortgage?
If the property was subject to a mortgage which is not being paid off after the change, then it will be necessary to obtain the permission of the lender to discharge the outgoing joint owner. Alternatively, we have another suggestion if you contact us.
If you do not own the property in joint names and wish to transfer it to your spouse, then they will have to pay the usual transfer tax. This arrangement is only for co-owners.
This process can be arranged fairly quickly without any need for you to come over to Spain by means of granting us a power of attorney. Please contact Amanda on enquiries@spanishsolutions.net for more information.