My husband and I live together in his property and have rented out mine for the last five years. I know I will have to pay capital gains tax when I sell mine. I wondered if it is worth my husband putting the house we live in into joint names. Are we potentially opening ourselves up to more tax on the home we live in at some point?
Arthur Weller replies:
If, in the future, you and your husband decide to sell this house, then assuming you both own 50%, half the capital gain will be attributable to each of you. If you are a higher rate taxpayer, and he is a basic-rate taxpayer, and 100% of the capital gain could have fallen within his basic-rate band, then between the two of you there would be more capital gains tax to pay. But such a scenario is not likely. Additionally, if you see that it could happen, you have the possibility of reversing today's transfer, and you could transfer back to him. So, most likely, what you are planning to do should not involve you in more tax.