‘Mixed marriage’ ownership of UK homes - .PDF file.
It is common for spouses to purchase their home without receiving tax advice. Ownership in real property seems like a straightforward and simple transaction to most people. Most spouses believe that they both love each other, and they will always love each other, so why not simply own their home as joint tenants? The lawyer’s answer is that it is rarely this simple, particularly if there is a diversity of citizenship and/or fiscal status among the spouses. In these instances, the purchase of real property as joint tenants can result in a tax disaster.
For example, say a US citizen and a UK citizen purchase their London flat as beneficial joint tenants. Under these circumstances, unwittingly the US citizen may be making a gift to his spouse that may result in a US federal gift tax being owed unnecessarily. The US federal gift tax would be owed either on the purchase or, more commonly, on a later sale of the home…
If you are registered and logged in to the site, click on the link below to read the Withers briefing. If not, please register or sign in with your details below.