Transferring property between spouses is straightforward, especially when it comes from a place of trust and shared ownership. But legal processes rarely follow emotional logic. One key concern that arises is whether stamp duty is due during such transfers.
While you might assume this is a tax-free move, the answer depends on several factors, including the nature of your relationship, whether a mortgage is involved, and whether the transfer is part of a separation or divorce. This article breaks down everything you need to know, helping you avoid surprises and make informed choices.
When Do You Pay Stamp Duty on a Transfer Between Spouses?
Transfers between married couples are liable for stamp duty based on the consideration paid for the share transferred. So, if you transfer half of a property worth £500,000 to your spouse, and they pay you £250,000, they would have to pay stamp duty on the £250,000. That would be 0% on the first £125,000 and 2% (at the current rate) on the second £125,000: £2,500.
When Property Transfers Are Exempt from Stamp Duty
Divorce, Dissolution, or Separation
If you are legally married or in a civil partnership and the property transfer is part of a financial settlement related to separation, stamp duty is usually not payable, even if money or a mortgage is involved. This applies to outright gifts and to arrangements where one person assumes full ownership from joint names.
Transactions Where No Money Changes Hands
For example, if you and your spouse own a home together and one of you wants to take over the full ownership without any money changing hands, this does not usually trigger a stamp duty bill, unless you are also transferring mortgage liability.
Mortgage Debt Changes Everything
Where a mortgage exists, the situation becomes more complex. Stamp duty is not just applied to purchase prices. It also applies when someone takes on a share of a mortgage as part of the transfer. So, if your spouse is added to the property title and takes over part of the outstanding mortgage, this might count as chargeable consideration.
That’s where the rules shift. If the value of the mortgage share being transferred exceeds the stamp duty threshold of £125,000 (as of 2025), stamp duty could become payable. This is one of the most common reasons stamp duty comes into play during a transfer property ownership to spouse scenario.
Separation and Divorce: Different Rules Apply
If the property transfer is carried out as part of a court order or formal divorce settlement, stamp duty is not usually due. The exemption exists to avoid unfair tax consequences during what is already a financially difficult time.
However, if the transfer is informal or done outside of official proceedings, HMRC may still view it as a regular transfer. In those cases, the rules relating to mortgages and consideration would again come into play.
Avoiding Missteps During the Transfer
Transferring property between spouses might seem like a simple formality, but a wrong assumption about stamp duty could prove costly. Take the time to look into how the mortgage value, relationship status, and legal agreements affect your situation. Even if you are gifting a home entirely, always check the latest guidance.
Before making any decision, consider speaking to a conveyancer or tax adviser. They can help you determine if any stamp duty applies and guide you through filing the right forms. While the rules aim to be fair, they are not always intuitive. Knowing the right steps will keep your property plans on track and stress levels low.
