Adding Non Married Partner to Deeds

Hi,

I am a separated male in a new relationship. My property is in my own name and my partner has a property in her name. We intend to extend and refurbish my property this year. To do this we would take an additional equity release from both properties - the question is if I add my partner to the mortgage/deeds of my property will she be liable to gift tax ?

If so is the gift element deemed to be the available equity ( eg 700K house, 300k mortgage, 400K equity/2 = = gift of 200K ) or is the gift calculated on the entire value of the property ?

The same question would arise I'm sure if she added me to the deeds of her property. I am aware the banks would need to consent to all of this as well.

As far as I know it is the value of the property that is taken into account not the equity. So it would be deemed that you had gifted half the value of the property to your partner. I am open to correction on this though.

There are ways this can be structured so as to avoid gift tax. There are other issues to consider too: do you want to leave everything in joint names so that it passes to the survivor? Or do you want to have an inheritance to leave to your side and she to hers? Talk to your solicitor and go through all the issues. If your solicitor cannot work out a structure which avoids gift tax, get a referral from him\her to someone who is more au fait with this area.