Signing over house from elderly relation

googler

funkey_monkey wrote: »

Is there a cut off point on rental income which is not taxed? i.e. is the first £x not taxed?

Subject to the same personal allowances as your other taxable income. If you've already started paying tax at the basic or other rates, the NET rental income after allowable expenses will be taxed at whatever rate you're currently paying.

Trollfever

ILW wrote: »

Councils have now got wise to most of these trusts and anything that was set up with the prime purpose of avoiding care fees are getting deemed null and void. Trusts set up many years ago seem to be OK.

The rules may be different in Scotland.

funkey_monkey

It was set up as a 'gift with a reservation'.

http://www.sthelenscarers.org.uk/Pathway/10.CPlanning%20for%20the%20future/When%20is%20it%20legal%20to%20move%20assets.pdf

See page 9 section 3.1

00ec25

funkey_monkey wrote: »

It was set up as a 'gift with a reservation'.

oh dear!
so the estate is liable for IHT (if the total estate value is above the nil rate threshold at the time of death)

and

you, as the owner, are liable for CGT from the date of the gift

funkey_monkey

What is the nil rate threshold?

Edit: found this: http://www.qck.com/uk-inheritance-tax-iht-nil-rate-threshold-rises-160450.html. Property is way below this evaluation currently - just not sure about the rest of her estate.

Is there any alternative way for her to sign it over to me? I appreciate that this is a way for Gov to avoid people handing over properties in order to evade care fees later in life.

ILW

Cannot see how you could avoid the deprevation of capital rules. Councils are going to be strapped now and will go for every penny.

Annisele

funkey_monkey wrote: »

Is there any alternative way for her to sign it over to me? I appreciate that this is a way for Gov to avoid people handing over properties in order to evade care fees later in life.

I would say no - but then I'm not a solicitor. If the solicitor is sure it can be done - and is prepared to provide the indemnity getmore4less suggested - I wouldn't like to disagree with him.

puddy

im in favour of people paying their own way for care etc, but it comes to something when someone cant even give a nephew or whatever a gift.

what about if she sells the house, buys a little retirement apartment and gives him the money as a gift?

jockosjungle

No offence Jenner but she's not giving a gift, she's lettimg them have her house when they die. They're just trying to avoid paying out money for care home fees should they be needed.

If she sells the house, gives the cash and then dies within 7 years she will still be liable to IHT, and I also imagine the council won't accept that you've given all your money away and are now penniless.

R

ILW

jockosjungle wrote: »

No offence Jenner but she's not giving a gift, she's lettimg them have her house when they die. They're just trying to avoid paying out money for care home fees should they be needed.

If she sells the house, gives the cash and then dies within 7 years she will still be liable to IHT, and I also imagine the council won't accept that you've given all your money away and are now penniless.

R

They probably wont want it then.