Best way to 'Give house to kids?'

wolvoman

margaretclare wrote:

I completely agree with this. I nearly asked the OP 'if you don't want you assets (i.e. your house) used to pay for your care, who do you think should pay for it?

Aunty Margaret

So you're suggesting that someone who works hard all their life and saves diligently should foot the bill for their old-age care.

And yet those who spend, spend spend through life and finish up in old age can have their care paid for them by the state.

Is that what you suggest is fair?

calleyw

wolvoman wrote:

So you're suggesting that someone who works hard all their life and saves diligently should foot the bill for their old-age care.

And yet those who spend, spend spend through life and finish up in old age can have their care paid for them by the state.

Is that what you suggest is fair?

Since when was life fair. Is it fair that other people have more money than me. It is just one of those things that we have to put up like it or not.


I think you will find if you are paying for your own care you will get a better choice of homes then if it was being paid for by the local authority.

And don't forget that some people may work all the hours they can but still are unable to save money because they are only just making it with min wage and just above the thresholds for tax credits etc. So by the time they have paid rent etc they have very little left to be able to save. So what do you say about those type of people that they wasters and should not have there care paid for.

Yours

Calley

margaretclare

wolvoman wrote:

So you're suggesting that someone who works hard all their life and saves diligently should foot the bill for their old-age care.

And yet those who spend, spend spend through life and finish up in old age can have their care paid for them by the state.

Is that what you suggest is fair?

Well, the original question related to a house, how to give it to 'the kids' to avoid the value of it being used to fund long-term care.

First, if you have 'worked hard all your life' and yes, we have, I don't see what's wrong with your assets being used for YOU and not funnelled away for another generation. When I say 'your assets used for you' I mean the possibility of extra choice, extra comfort, those kind of things.

I can't possibly start making judgments along the lines that you suggest: 'this person has spent all that came his/her way, that person has not'. That argument smacks too much of the Victorian idea of the deserving/undeserving poor. Incidentally many of my immediate forebears 'worked hard all their lives' - a grandparent and great-grandparent died in a workhouse infirmary. Had they deserved that? And yet, they were the people who long ago taught me the value of savings.

Aunty Margaret

[Deleted User]

bobmccluckie wrote:

Finally why shouldn't people pay for the care component of their costs. Why should the tax payer pay just so that the middle class can inherit?

bobmcccluckie - I find your comment extremely dispicable. So do you think that middle class (whatever that is) are non-taxpayers? Whatever class we are in, we are all tax payers and we all pay our share of tax. In fact, something that may have escaped you, those who earn more, also pay more tax. So I think it is perfectly feasible for all classes to take steps to minimises the impact of inheritance tax. If you are one of those people who always spent your money and never saved a penny, and then expect the state to support, who are you to object to those who saved all their lives and then because they have money, the state can take it away from them, whether through inheritance tax or other means. Your attitude really disgusts me!!

dchurch24

Inheritance tax is the most despicable and immoral of all taxes. Anyone who manages to legally circumvent this tax has my thumbs up.
The Govt. take lots and lots of money from honest, working people. The tax on that house has already been paid in my opinion, in the form of stamp duty, the tax on household bills/fuels etc... over the years.

I would say that it's been paid for over and over, and if the OP want's to give it to their children, then that's commendable. It may just save them from having to go through the same rip-off rules.

There must be something fundamently wrong with a society that lets you pay lots of your hard-earned money to a govt. and then once retirement hits - you're on your own.

roger_c

Getting back to the point in hand has someone informed you about, 'Gifts with reservation of benefit'? Its not my area of expertise, but if you continue to benefit from a gift, then you are supposed to pay market value rent to the person who it is gifted to. I can't remember the ins and outs of it all, maybe someone can clear it up?

Robert_Sterling_3

in the case of rich people this is even better.
You give your house to your children AND you pay them rent for it.
Lovely.

margaretclare

roger_c wrote:

Getting back to the point in hand has someone informed you about, 'Gifts with reservation of benefit'? Its not my area of expertise, but if you continue to benefit from a gift, then you are supposed to pay market value rent to the person who it is gifted to. I can't remember the ins and outs of it all, maybe someone can clear it up?

Yes, I know what you mean, but I'm not an expert either.

A gift is a gift - it's like me saying 'here's your Christmas present, but although I'm giving it to you all wrapped up, I really want to keep it for myself. You can have it after I'm dead and not before.'

In other words, you can't give something (in this case a house) to someone else, and continue to have the use and benefit from it yourself (in this case, by going on living in it).

But hang on a minute, the house is yours, no mortgage, you can give it away - of course you can! Only problem is, you're gonna have to find somewhere else to live, aren't you? And if you give a house to someone else who already has a perfectly nice house already, and they want to sell it, then they're gonna have to pay the appropriate taxes on the sale, because it's not their 'first or main residence' or whatever the term is.

We once sold a house at way below its market value to family members. But that was a different scenario.

Aunty Margaret

Robert_Sterling_3

If you are rich it is great.
You give your property to your children.
Then you also pay them rent so that you can continue to live in it.
Both moves help to reduce IHT.

worried_and_confused

For information only, this may be of use to someone...

Contains info about setting up different types of discretionary trust etc.

Follow this link, pdf.

If anybody is thinking about going down this route, I would strongly suggest you get proper independent financial advice, rather than doing it over the internet.

Also bear in mind that the law might be tightened up to prevent the use of disrcetionary trusts to avoid IHT.