Questions about transferring property to spouse

Hello everyone,

Quick question a friend asked me and not 100% sure.

Imagine Miss A and Mr B are about to get married. Miss A owns a property with mortgage outstanding. Mr B owns another (larger) property with mortgage outstanding.

So, question is - do Miss A & Mr B automatically become co-owners of eachother's properties once they marry & are there any tax implications?

Yes, all assets are then owned 50-50.

Tax implications?

Well, if they live in house A, that is their PPR, and house B is a non-PPR. If they rent it out, it becomes an investment property. They will get TRS just on the PPR.

Marriage does not confer automatic property rights/ ownership. So, a spouse does not automatically become a joint owner of anything unless they actively take steps to formally put property in joint names.

People often confuse the idea that marriage confers a protection against alienation without consent on a non owning spouse on the Family Home with the idea that, without even talking about it, marriage confers 50/50 ownership on each on all their assets.

mf

Protocol said:

Yes, all assets are then owned 50-50.

Click to expand...

This is not true.

Married people can continue to own assets solely in their own names. They have can have sole bank accounts and directorships and shareholdings - nothing changes. If they wish, they may transfer assets between each other freely without tax implications such as gift tax (capital acquisitions) or stamp duty. From a financial point of view this is one of the main features of marriage.

The main thing to watch out for is that if the couple make one of their houses a home, the owner cannot sell or remortgage the house without the consent of his
non-owning spouse. This is the Family Home Protection Act 1976.