Best way to 'Give house to kids?'

Llane

I haven't read the whole thread, so I don't know if this has been brought up, but my parents are helping me buy a home in such a way as to avoid us both being taxed on the transactions. There is a limit to how much money someone can "gift" to another during a year without either party being taxed, and my each one of my parents give that amount to me each year. This pays the mortgage on my place, allowing my parents to start giving me my inheritance slowly and without paying taxes on it. Much more efficient than a lump sum with a massive tax bite taken out of it.

margaretclare

Llane wrote:

I haven't read the whole thread, so I don't know if this has been brought up, but my parents are helping me buy a home in such a way as to avoid us both being taxed on the transactions. There is a limit to how much money someone can "gift" to another during a year without either party being taxed, and my each one of my parents give that amount to me each year. This pays the mortgage on my place, allowing my parents to start giving me my inheritance slowly and without paying taxes on it. Much more efficient than a lump sum with a massive tax bite taken out of it.

Hi Llane

This sounds like a good idea. But it's not what the original poster was asking. If I remember rightly, the OP wants to 'give away' the house they own, but to still carry on living in it, to avoid IHT after their death.

Incidentally, there was a very good discussion yesterday afternoon on Radio 4's 'MoneyBox Live' and all these questions were discussed in detail in half an hour! Someone else brought up the kind of situation you're in, and the 'experts' on the panel all thought it was a really good idea.

What seems to cause the biggest problem is when people have a house, mortgage all paid, want to leave it to children after they die, so think of 'giving' it away, but also want to keep living in it! An obvious thing would be, if it happens to be a biggish house as is often the case, 'down-size' and give away some of the capital released from the sale, to offspring for their mortgage etc. But a lot of people seem to be unwilling to do that. 'It's the family home, it's where we've always lived...' I've heard it all before.

Aunty Margaret

sippnewbie

whizkid wrote:

Ideally though no one should pay! the tax thresholds should be raised to take out most of us average earners and tax more heavily the fat cats and pop stars/footballers etc who are super rich and spend much of their money abroad.

oh dear. your facts a simply wrong. furthermore it has been shown time and time again and is pretty obvious that as tax rates increase the actual tax take levels off as the rich/clever find ever more ways of avoiding/evading tax or they simply leave the country.

whizkid wrote:

most of the wealth in Uk belongs to a very small number of people, the rest of us just work hard pay taxes and generally get stung.

once again your facts appear to come from a some silly student weekly. from another perspective hard workers pay more for facilities they dont use.

the current system simply punishes hard working savers and rewards wasters.