Transferring Property to your PartnerBen Olsen
It is normal practice that spouses or de facto partners hold ownership in their property jointly. However, there are times, when you may need to consider holding the property in only one name.
When: if real property (house, land, unit, etc.) is owned in joint names and you want it exclusively owned in one person’s name
Why: there a numerous reasons, but some of the more common uses are –
- asset protection – where one partner is in a high risk career (i.e. risk of being personally sued) so ownership in the family home is transferred to the other partner
- tax minimisation – commonly used for investment properties where the investment is positively geared and one spouse is a high income earner, they may remove themselves from title so all income earnt for that property is received by the remaining spouse (who is on low/nil income) exclusively. The opposite may apply if the investment property is negatively geared.
- succession – where your succession plan is to ensure that certain beneficiaries receive the benefit of the property (as opposed a potential new partner of your spouse if they remarry after your death)
- property settlement – due to break down of relationship and one party is to receive the property exclusively
How: a formal transfer will need to occur, involving the preparation and execution of transfer documents and the lodgement of these at the Titles Registry. Please note that stamp duty will generally be payable in relation to the share being transferred. You should seek legal advice, as evidence of market value and other documents will need to be obtained/prepared for stamping purposes.
Myths: Q: If I transfer my half to my partner and we break up, won’t I be left with nothing?
A: No, the Family Law Act would generally deem such property a matrimonial asset irrespectively of who own it on title.
Q: If my relationship breaks down, we can simply come to a private arrangement regarding assets (including transferring property) and that is the end of the matter?
A: No, you should seek independent legal advice to arrange a formal property settlement, this is also the only way to obtain an exemption from stamp duty in real property is being transferred.
Q: If I transfer my share in our house to my partner exclusive, then no stamp duty is payable?
A: No, generally stamp duty will be payable in these circumstances, based on the market value of the property at the time of the transfer.
If you have any questions or require further clarification regarding any of the above, please feel free to contact Olsen Lawyers on (07) 3846 5288 for a free, no obligation discussion.