Property purchase taxes for mixed residency couple

08/06/2010 - 06:36

I am currently starting the process of buying a property with my fiancee. She is �� and has residency. I am English and need to travel (UK and other countries) and so do not have residency. There is a chance that I may change residency within 3 years, but would not bet on this. With an aging parent in the UK this also needs to be considered as I may need to do my share. Currently this travel offers the benefit of lower income tax options (which comes in very handy when looking to set up a home). I will be a full �� resident one day and truly look forward to living a normal �� life (using the suitcase for pleasure only). I had understood that for split residency couples buying a property the tax for resident purchase and non-resident purchase would be split. Her share at 3% and mine at 10%. Is this still correct? If that is so, we had considered buying in her name only. But would I still be covered in case of splitting up? A friend had said that you are covered for the % that you can prove you have contributed, but they are an electrician! We have been together (not married yet - that will follow after the house) for over 10 years and have lived in multiple countries through good and bad times. I am very happy........but try to be a little cautious (especially when some good friends are divorcing after 26 years of marriage). We are going to discuss this with a lawyer and Nataio, but any guidance would be appreciated. Nervous enough as it is!!!!

Topic

Buying

Property

Comment

Your electrician is right.... If your fiancee buys in her name only, and you are not married, she owns 100% of the property. Even when you are married, the property remains hers. I think that you could only ever recoup the amount of money you had contributed to the purchase, and that would have to be proved in court. If you buy in both names, she can claim prima casa on her half - and pay 3% of the catastal value and you will pay 7% in tax It will cost you a bit more on the purchase, but bear in mind the taxes are based on the rateable value and not the price you are paying, but you will have more peace of mind.

I'm afraid having just been through a very similar situation, it is nigh on impossible to prove the contribution you made wasn't a gift and therefore not a loan requiring repayment. If you want to be protected, you need to have your name on the deed for the %age you contribute. Anything else is too risky.

I agree with Penny and Ram. The important thing is that you are not married (yet). Stump up the extra 4% (as Ram points out, this is based on catastal value and not sale price) and so you are a 50% owner for very little money.