Can We Gift Our Buy-to-Let (BTL) Property to Our Children?

My wife and I jointly own a (mortgaged) BTL property. Our children are now 18 and 19. Can we gift 1% of the property to each child (new share of property capital being 49% / 49% / 1% / 1%) and sign an agreement that all rental income + expenses are to be shared 50:50 between the children? As they are at University, their personal allowance should ensure there is no tax to pay and, of course, my wife and I would pay no tax. Also, would there be any stamp duty or other costs in involved in the 'gifting'?

Each one of you (the father and mother) should gift 1% of the property, one of you to one child and one of you to the other child. There is no stamp duty land tax on this transaction because it is a gift for no consideration. There most probably will not be any capital gains tax (CGT) either, because we are only talking about 1% of the property, and each one of you has an annual exemption for CGT of £10,100.

Then you draw up two written agreements (the first between one parent and one child, and the second between the other parent and the other child), as you made reference to. As can be seen in HMRC Property Income Manual page PIM1030, this works to 'shift' taxable income from one partner in a property partnership, to another partner.