Stamp Duty Exemptions

Hi All,

Here is the scenario. My girlfriend is going through a divorce and i am buying out his share of the property. I have just been through a divorce and sold my property so i can buy him out and have somewhere to live. She is exempt from stamp duty but apparently i will have to pay stamp duty which is a lot of money. We where going to have it in joint names, the loan and the title. If it's just her name on the loan and title there will be no stamp duty but because of the low income she may not get the loan approved. Can we have the loan under joint names and the land title under her name? Or does that mean i still have to pay stamp duty? Thanks

 

You might also be able to go guarantor for her loan.
Whether that's the good idea or not though, I'll leave up to you.

 

I gather that 'girlfriend' is not your spouse, but a friend, if so then no lender will lend if you are not on title.

You could minimise the stamp duty, though, but going for tenants in common 90/10 so you will pay duty on the 10% portion only.

Seek legal advice first.

 

Hi Terry W,

Girlfriend meaning spouse, domestic relationship. We live together in a relationship.

 

So you are buying out the ex-spouse of your girlfriend?
No duty exemptions for that, but you could minimise duty by having your girlfriend buy out say 40% of the ex-partners 50% and you buying out 10%. I haven't checked though so get legal advice before trying - from a lawyer.

 

That would work in theory but she doesn't have any available cash. Its all in the property. I spoke to the bank and i asked them if she was the only name on the land title and the loan was in joint names would we have to pay stamp duty. Answer was no.

 

Is the bank going to reimburse you when osr comes knocking?

 

If the land title is just under her name what's the issue? Why does it have to be under joint names?

 

Why do you have to pay stamp duty on a property twice. Effectively my money is her money so by me paying stamp duty so is she when she should be exempt.

 

Why are you taking legal advice from a bank?

 

It could be all done simultaneously. No cash needed.

 

Actually as you are the new spouse it could work. She buys from ex-spouse, and you go onto loan as the new spouse.

 

I guess that's kind of my point. Why should i be punished with stamp duty when i am the new spouse. Maybe i will take that approach. She buys him out and i become the new spouse. We would have been living under the same roof and in a relationship for more than 12 months by the time this all happens.