How to Transfer Ownership of a House

Transferring ownership of a house without selling it is a common process in the UK, often used in family situations such as gifting a property to a spouse, transferring equity to a partner or adding a child’s name to the title. While no money changes hands in these scenarios, the legal implications are significant. This process is known as a transfer of equity and can affect mortgage responsibilities, tax liabilities and ownership rights.

This guide explains how to legally transfer ownership of a property without selling, what circumstances the process applies to, and the steps involved in completing it smoothly. It is designed for homeowners, couples, separating partners and families who want to change legal ownership while retaining the property within the household.

What Is a Transfer of Ownership Without a Sale?

A transfer of ownership without a sale typically involves adding or removing someone from the title deeds of a property. This is often done for personal, financial or legal reasons, such as marriage, divorce, inheritance planning or tax management. The transaction is classed as a transfer of equity rather than a sale because full legal ownership is not being passed in return for money.

Common examples include gifting a house to an adult child, transferring property between spouses, or a cohabiting couple formalising shared ownership. In some cases, the property may be placed in trust or passed to a family member to avoid inheritance complications.

Who Can Transfer Property Ownership?

Only the current legal owner or owners named on the property’s title register can initiate a transfer. The process is available to both freehold and leasehold properties and applies across England and Wales. In Scotland, a similar process is followed, although the legal framework is different.

The new owner must be over the age of 18 and legally capable of owning property in the UK. If the property is mortgaged, the lender’s consent is required before any transfer can take place.

Legal Requirements and Process

The transfer of ownership is a legal process that must be registered with HM Land Registry. It usually involves a solicitor or licensed conveyancer, particularly where mortgages or tax implications are involved.

The key document is the TR1 form, which records the change in ownership. This form is submitted to HM Land Registry along with the original title deed, the appropriate ID checks, and payment of any applicable fees. If the property is mortgaged, the lender will often require a formal remortgage or deed of consent before agreeing to the change. The solicitor will handle communication with the lender and ensure all documents are completed correctly.

A Stamp Duty Land Tax return must also be filed with HMRC, even if no money changes hands. Tax may not be payable, but the return is still required in most cases. If the transfer is in exchange for assuming responsibility for a mortgage, the tax will be calculated based on the value of the mortgage share being transferred.

Costs and Timescales

The cost of transferring ownership depends on the complexity of the transaction and whether a mortgage is involved. Solicitor fees for a straightforward transfer of equity typically range from £300 to £750 plus VAT. Additional charges apply for Land Registry fees, which range from £20 to £500 depending on the property value and method of submission.

If there is a mortgage to be changed or reissued, the lender may charge an administrative fee or require a valuation. Inheritance tax or capital gains tax may also be triggered in certain situations, particularly for second homes or investment properties.

The process can usually be completed within four to six weeks, although more complex cases involving trusts, mortgage restructuring or divorce settlements may take longer.

Common Reasons for Ownership Transfers

A married couple may choose to add one spouse to the property title for legal or financial planning purposes. During a divorce or separation, one partner might transfer their share to the other as part of a settlement. Parents sometimes transfer their property to children during their lifetime to reduce the value of their estate, though this must be carefully timed to avoid tax complications under the seven-year rule for inheritance tax.

In cohabiting relationships, adding a partner to the title ensures joint ownership and can provide legal protection in case of relationship breakdown. It is also common in remortgage scenarios, where one party takes on full mortgage responsibility and becomes sole owner.

Risks and Considerations

Transferring ownership without understanding the financial and legal consequences can lead to issues later. If a property is gifted and the original owner continues to live in it rent-free, HMRC may class it as a 'gift with reservation of benefit', which can have inheritance tax consequences. Mortgage lenders may refuse consent if the new owner does not meet their affordability or credit criteria.

In cases of divorce or family breakdown, transferring property can become complicated if both parties do not agree or if children’s housing needs must be considered. It is always advisable to seek independent legal and financial advice before proceeding.

Case Example

A widower in Nottingham decided to transfer the ownership of his mortgage-free bungalow to his daughter to help with long-term estate planning. With the help of a solicitor, he completed a TR1 form, and the title was updated at HM Land Registry. No Stamp Duty was payable, and he remained living in the home under a tenancy agreement to avoid triggering a gift with reservation. The process was completed in six weeks and allowed the daughter to take over responsibility for future decisions relating to the property.

Conclusion

Transferring ownership of a house without selling is a practical way to formalise family arrangements, plan for the future or reflect life changes. While it may seem simple, it has legal and tax implications that must be carefully considered. By working with qualified professionals and following the correct process, you can transfer ownership with clarity and confidence while protecting the interests of all parties involved.