Purchasing with partner

[Stonerosefan]

Hi All

First time logging in- great site.

I have a couple of questions:

I purchased a 2nd handhouse with my sister last year and paid stamp duty, both of us are living in the house and have two flatmates.

My fiancee and I are contemplating buying a place together- she is lucky enough to work in a financial institution and can get 100% finance.

If she was to purchase the house alone , she qualifies as FTB, I would not.

1) Can I go on the mortgage but not on the deeds of the house (looking at buying second hand) with her until such time as we are married ?Would this avoid stamp duty at a higher rate ?
We would be both living in the house . My sister and I plan to keep on our exixting residence, she will continue to live in it with tenants.

2) What would my tax situation be then once the residence is transferred into joint names after we were married ? I believ there is no CGT/Gift Tax between husband and wife. Any property my fiancee and I purchase will be our primary residence

Thanks for any advice

 

[contemporary]

It could be risky as any split before marriage (touch wood it wont) would mean that it was her house and you would have a hard time proving it was yours too.

I doubt the bank would give you a mortgage in any case without seeing your name on the deeds.

 

[Munsterdude]

Stonerosefan,
Funny you should ask that question! I am a broker, and am working on a very similar case right now. I have been in contact with all the banks in the last couple of hours on this matter. In short, you can get your fiancee on the title deeds, and both of you on the mortgage with the following institutions: Ulster Bank, IIB (only if you are engaged) Bank of Ireland, and maybe NIB. So far, none of the others have said yes.
I dont know about the tax situation, but from a legal point of view, I would have some sort of agreement in place prior to proceeding, in the (hopefully unlikely) event of a break up.
Does this help?
M

 

[ClubMan]

Apart from the risk mentioned above in relation to a FTB and non FTB buying in this way note what mf1 says in this thread about how Revenue may view such purchases.

 

[Stonerosefan]

Thanks everyone for the replies. I guess my main concern is around the practicalities of it.

If my fiancee and I did purchase a property together, would we both be able to claim mortgage interest relief on it ?
Would my present residence then be viewed as an investment property ? Effectively, I would not be making any money from my existing residence, as the rental income along with my sister living there will cover the repayments only.

Munsterdude,if my fiancee went on the deeds of the new house alone (assume its second hand) and costs 317.5k +, will the stamp duty liability be at the lower rate as she is FTB ? After we are married is there any tax between spouses if the deeds were transferred to joint names ?

Thanks !
SRF

 

[ClubMan]

Thanks everyone for the replies. I guess my main concern is around the practicalities of it.

Check out the link I posted above about the question marks over the approach of a FTB and non FTB buying together with only the former's name on the deeds.

If my fiancee and I did purchase a property together, would we both be able to claim mortgage interest relief on it ?

Yes - but if she is an FTB and you are not then you will get lower tax relief.

Would my present residence then be viewed as an investment property ? Effectively, I would not be making any money from my existing residence, as the rental income along with my sister living there will cover the repayments only.

As far as I know this will be treated as an investment property and the usual rules apply. The fact that the rent is only covering the repayments is neither here nor there. If you were collecting more than €7,620 in rental income while you were living there then it is already a rental property and those rules should have applied. And also a clawback of stamp duty if you were renting it within five years of purchase as an owner occupier for more than €7,620 while living there.

Munsterdude,if my fiancee went on the deeds of the new house alone (assume its second hand) and costs 317.5k +, will the stamp duty liability be at the lower rate as she is FTB ?

Again check out the link I posted earlier as there are some question marks over this approach.

Also non married couples or other individuals buying together should put in place a suitable legal agreement covering the purchase.

After we are married is there any tax between spouses if the deeds were transferred to joint names ?

No.