Hi experts,
In a messy situation with a property bought two decades ago with some borrowed money from a relative.
At that time of purchase, the agreement was that he wasn’t interested in joined name ownership due
to rather small amount of money. So I am the sole legal owner on the title.However, situation has changed that the relo now wants a pro-rata share of the property based on
his old contribution which works out to be around 10% ownership roughly.Is it possible to “transfer” such fractional ownership to him legally so no tax complication? Obviously
he will need to pay for stamp duty if such transfer is possible at all.But does it trigger a CGT for me as even retaining 90% of the property ownership today, the valuation
will be much higher than when it was bought two decades ago.Thanks,
FXDSounds like you may have been acting as trustee for him. If you can prove the trust relationship there may be nominal duty and no cgt event.
If you cannot then there will be duty on the value transferred. It would also be a cgt event.
Younwill need to discharge the mortgage and reapply for a new loan. Consider issues with deductibility of interest.
Younshod seek legal advice.
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
You must be logged in to reply to this topic. If you don't have an account, you can register here.
