Pippa and Bob live together in their main residence which they own jointly. They also own jointly a holiday home. Bob wants to transfer his half share of their main residence and existing mortgage to Pippa.
The chargeable consideration will be based on the value of the existing mortgage plus any cash sums paid. The existing mortgage on the dwelling is £320,000. As no cash is being paid, the chargeable consideration will therefore be a half share of the existing mortgage, £160,000.
LBTT will apply on the value of the half share of £160,000. As Pippa already owns a share of the dwelling ADS will not apply.
Information on debt as consideration can be found in LBTT2003.
Details on the ADS treatment where the transaction involves the acquisition of a further share of a dwelling can be found in the LBTT Technical Bulletin 1.