Giving house to daughter (Scottish Law)

j2011

My spouse's mother has passed away and left her house (along with everything else) to my spouse, her only heir.

It is a 2 bedroom bungalow and it is ideal for me and my spouse to move into as we live in a 3 bed semi and I have problems getting up and down the stairs.

So we are moving in to it.

That will leave our present 3 bed mortgage free house empty.

Our only daughter, along with her partner and 10 year old son, presently live in a council house in a not very good area, where they are getting housing benefit, council tax benefit and anything else her non working partner can claim.

Since our daughter and her son are our only remaining heirs (she is not married) and she would inherit the house anyway we are going to give her the house and transfer the title to her for nothing. Free.

She will of course become responsible for council tax, bills etc. We are not renting it to her.

I would also like to make sure that her OH has no claim on the house if anything happened to her.

I would imagine that her housing benefit and council tax benefit would stop.

Most of her income is benefits so I can see me having to bail her out occasionally but what are parents for.

Also her current house is band B and ours is band E council tax.

The house is valued at £170,000.

Other option is to sell the house but what would we do with the money, we have enough to live on without it and the house we are moving into will have lower bills than our present house.
We will of course consult a solicitor but can anyone see any pitfalls to what we propose either for her or for us?

BitterAndTwisted

Her housing benefit will stop but I can't see any reason why the C Tax would. I honestly think you should consider retaining ownership of the property as I understand that Scottish law recognises common law relationships where they do not in England. Unless there's a trust or something you could set up with the help of a solicitor to ensure your daughter's partner could have no claim on the property.

Jowo_2

As with any transaction like this, you should understand the rules around Deprivation of Capital. I know that Scotland has a more generous social care system for elders than England.

However, you should understand how if you need to make a means tested benefits claim in the future, the DWP may include the property which you've given away and reject it under their notional capital calculations.

getmore4less

I think I would look at this from a slightly different angle.


Our only daughter, along with her partner and 10 year old son, presently live in a council house in a not very good area, where they are getting housing benefit, council tax benefit and anything else her non working partner can claim.

Is this a permanant state, are they trying to get out of the benifits trap.

Will this piece of good furtune put them on the road to recovery or will they just carry on living as best they can on benifits.

If you think this will end up successfully then I think it is a good idea.
Definately need advice on the protecting the asset situation not just from that angle but also the tax situation.

If not then I would look at either renting the place out properly and use the income to help your daughter without affecting their current situation.

Or look at selling up and making good use of the money yourself, your daughter and grandchild.

At the end of the day there will still be the bungalow for your daughter to have later.