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What are the tax positons of both partners in a property split by non-spouses?

Question:
Could a property split of say 80:20 be effected retrospectively after a rental property has been purchased jointly by two individuals (not spouses) with each partner contributing 50% of the purchase price? That is to say, the ownership of the property is in reality 50:50 and the distribution of profits follows this ratio. One of the owners lives and works in the UK and would like to minimise his tax bill. The property is overseas in a country where there is no income tax. The second joint owner lives and works there and therefore pays no income tax on his/her share of the profits and as such it would be useful to allocate more of the rental income to this overseas partner. I imagine at some future date when the property is sold that there will be benefits for capital gains tax purposes, too. Could this change be effected retrospectively in a manner that would satisfy HMRC or is this, as I suspect, a process that can only be applied at the time of purchase?

Arthur Weller replies: 
If you look at www.hmrc.gov.uk/manuals/pimmanual/PIM4703.htm about rents from property outside the UK, it says: "The profits or losses are computed using trading principles just like those of a UK rental business. So the other parts of the Property Income manual generally apply to receipts and expenses of properties outside the UK as well as those within the UK." At PIM1030 it states that two joint owners of a property (not spouses) can allocate the rental income between themselves in a ratio that they want, even though it is not the ratio of the underlying ownership of the property (e.g. 50:50). But this cannot be done retrospectively, see www.hmrc.gov.uk/manuals/bimmanual/BIM82055.htm. However, besides this, there is nothing stopping the UK partner now transferring 30% of the capital ownership of the property to the non-UK partner, although this may trigger capital gains tax. But again this cannot be done retrospectively.
Could a property split of say 80:20 be effected retrospectively after a rental property has been purchased jointly by two individuals (not spouses) with each partner contributing 50% of the purchase price? That is to say, the ownership of the
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This question was first printed in Business Tax Insider in May 2015.