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Moving in to parents house, help!
haggis88
Posts: 1 Newbie
Hi, I dont know if im posting this in the right forum.
My parents have offered to sign their house over to my wife and I, we would then take a mortgage out on the property and use the money to build an extension onto the side of the house. This would be a self contained "Granny flat" where my parents would live and we would live in the main house. Im just wondering if we would face any problems with Inheritance Tax? the value of the property at the moment is no more than £200,000. Thanks.
My parents have offered to sign their house over to my wife and I, we would then take a mortgage out on the property and use the money to build an extension onto the side of the house. This would be a self contained "Granny flat" where my parents would live and we would live in the main house. Im just wondering if we would face any problems with Inheritance Tax? the value of the property at the moment is no more than £200,000. Thanks.
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Comments
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Not that I'm an expert, but it'll bump it anyway...
Will the whole estate be over the tax threasehold?
There's a time limit for gifts, but I have a feeling that if the HMRC deems that the reason the gift was given was simply to avoid tax then they count it towards the tax bill - and the fact that your parents will continue to use the house without paying rent will make them question the 'gift' aspect of it.0 -
Do you really want to live soooo close to your parents????????????0
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If the house is gifted to you, and your parents do not pay a market rent for occupation. Then the property will remain as their assets for IHT purposes.
There are potentially CGT implications if you sell the property as well.
So take professional advice as this is not as straight forward as you might imagine.0 -
This sort of relationship should never be DIY. Get proper legal advice, and draw up a binding agreement about who owns and pays for what....much enquiry having been made concerning a gentleman, who had quitted a company where Johnson was, and no information being obtained; at last Johnson observed, that 'he did not care to speak ill of any man behind his back, but he believed the gentleman was an attorney'.0
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