Am i liable for tax with this type of property transfer?

collectors

Hi, hope i'm in the right place?
I purchased a house that myself (Son) & mother lived in from the local council under the right to by scheme, & both still live there. The property had to go in joint names as my mother was the original tenant & payee of the rent to qualify for the discount.
But as she was 65 at time of purchase, it was myself that had to raise the mortgage & have maintained the house & all repayments. She is now 91 & as fit as a fiddle.
Question is! Can the property be transferred into solely my name (Should be no problem) & more important, would i be liable for any tax.
We cant quite make out if this would be classed as a gift if i was the one that paid for it.
Property has a rough value of 320K

Many thanks

Chris.

poppy10_2

If it's been 26 years since the purchase then clawback of the RTB discount isn't an issue.
You or your mum won't be liable for capital gains tax as it has been your main residence.
Don't really see any tax problem here other than stamp duty. But when you're talking about a property worth £320,000, it's always best to spend a couple of hundred quid on some proper legal advice from a solicitor.

Jowo_2

Anyone know how this could be seen under the 'deprivation of capital' rules whereby means tested benefits, including social service care, can be affected?

I'm thinking of the way that some local social services contest a person's entitlement to free care if they are judged to have given away their capital to qualify for it, that they treat the person as if they still have the capital ('notional capital').

Perhaps the OP should take advice from a charity that deals with the elderly or Shelter, for example, to understand any of the unintended consequences of this transfer?

collectors

Thanks for the info everyone. The "deprivation of capital" is an area that i didn't know about & will have to look into it. But not sure on how it effects me in that i realise the reasons for not giving away a property to a son/daughter that is living else where. But not sure how i would stand being the one that lives in the property & paid for it.
Feels a bit like walking on thin ice.

G_M

No one has mentioned inheritance tax.
Your mother owns half the property (even though you paid for it). If she gives it to you, that is a gift. Provided she lives another 7 years, there will be no inheritance tax liability, but if she were to die within 7 years then there might be.

It would depend if her estate in total was over the IT allowance, and exactly how many years had passed at the time of her death.

If you leave the property in joint names, then on her death half the value of the property would be included in her estate when calculating IT liability.

collectors

Hi GM, I think we re ok on this part as it only involves half the price of the property & mums total wealth would not be anywhere near the £325,000 in 2009-10 I/tax.