Transfer income-producing assets to your spouse or civil partner

Transferring assets such as property or quoted investments to a spouse or civil partner is accepted by HMRC provided there is an outright gift with no conditions attached to it.

Save income tax on share dividends:  Following the change in how dividends are taxed, it can be beneficial for both spouses to receive dividends so that they both utilise the available zero percent dividends band (£2,000) and basic rate tax band.

Save income tax From April 2017 there has been a restriction in the amount of relief that can be claimed on interest charges by landlords who own residential property. The restriction is being phased in over four tax years and, by 2020/21, higher rate tax payers will only be entitled to basic rate tax relief on their finance costs. Spouses/civil partners should review their ownership of residential rental properties.

As well as the potential income tax benefits, transferring assets between spouses/civil partners could reduce the high income child benefit charge and also the potential loss of personal allowance. It is also important to consider Stamp Duty Land Tax (SDLT) implications where debt is involved.

As with all of our tax tips and web pages this information is necessarily summarised and of a general nature.  If you would like detailed specific advice please contact us.