Client is the beneficial owner of a property, they have always been the owner the property was purchased by her brother who used his name to finance the purchase. There was no official trust document created it was just a verbal arrangement that the property is held in trust. All the bills, the council tax were paid by the sister and her partner who have lived in there.
The brother is looking to sell the property now the sister is in a position to purchase the property. Property was purchased is 2014, she hasnt registered the bare trust online. Can she register the trust now (will there be a fine)? And if she was to purchase the property can he avoid cgt and her sdlt based on her being beneficial owner all these years.
I imagine this a similar scenario based when parents purchase properties for their children when they are students.
Not entirely clear what is being done here. Your client is “the sister”? If she is “the beneficial owner of a property” and “always has been”, how can the brother who “used his name to finance the purchase” sell it as it does not beneficially belong to him?
Brother is legal owner, i.e. property was purchased buy him for the purpose of getting a mortgage, (lender consent was there) she wishes to move the title to her name and remortgage.
then I suggest that this is not a sale but a transfer by bare trustee to beneficial owner. No money is passing hands as consideration today, but those wiser than me will know whether there is any prospect of CGT arising.
It would be wise to obtain the fullest information about the circumstances of the purchase. How it came about that brother decided to assist his sister to get a mortgage, why wasn’t it bought in joint names, obtain bank statements showing where deposit came from, what client told the solicitor acting on the purchase etc .
Then consider whether a crime was committed - if the brother told the lender that the deposit money came from his resources and he was buying for his own home - did your client thereby obtain a pecuniary advantage by deception?
Since the brother bought the house for the sister and All the bills, the council tax were paid by the sister and her partner who have lived in there, I would agree the sister is beneficial owner. I would formalise a verbal trust via a Historical Deed of land under S53(1)(b) Law Of Property Act 1925. With that in place, he will not have to pay CGT and sister will not be to pay stamp duty as there no monetary consideration