Parent wants to sell me their house

sincy231171

I wondered if anyone could help here, my father wants to sell me his house for £1. He wants to do this for a few reasons: -

1 - to avoid any care costs that he may have to incur in the future
2 - so that my brother and one of my sisters, and certain grandchildren do not get their hands on the money from the property.

I have read that solcial services can basically force the sale of the propoerty should they think it was sold to aviod care costs.

Also have heard that my sibling can challenge any will my dad makes that state they are due nothing from the house. he wants me to have it as when i lived there 15 years or so ago i helped pay the mortgage, and also when i move back for 6 months ten years ago i also helped them.

My mother died a few years ago and my dad is in his 70's.

Can he do this, if not what can he do to make sure the house goes to me and he does not have to sell the house for care costs.

Also what affect will this have on me and my tax or child benefits?

the house is valued at about £80k

jem16

sincy231171 wrote: »

Can he do this,

Of course he can do this but he would be very silly to do so. I suggest you google "deprivation of assets" where you will find that the council would assume he has got rid of the house purely to avoid care home fees and would be able to take the house regardless.

if not what can he do to make sure the house goes to me and he does not have to sell the house for care costs.

He can't as you are not dependent on him.

One question for you and your Dad. Why should the rest of the British taxpayers pay for his care costs if he can pay for them himself?

Also what affect will this have on me and my tax or child benefits?

If he did sell the house to you, you would become liable for capital gains tax when you sell it.

Linton

From his point of view I think it really would be a seriously bad idea...

Where will he live after he has given you the house?

If he intends to carry on living in what would be your house then he is completely dependent on you not becoming bankrupt and any other event that could force the sale of your house. There seems to be a history of falling out between various family members - what happens if you and he fall out. What guarantees are there that he wouldnt be thrown out of your house?

Which country do you live in? AIUI ..
In England your father can leave the inheritance to whoever he wishes (with some rights for dependents). In Scotland however the children have rights to part of the property.

alanq

I am pretty sure that a sale for £1 would be treated as a gift for inheritance tax purposes.

If your father continues to live in the house then, unless he pays you rent at the market rate, it will be treated as a 'gift with reservation of benefit' and still be treated as his for IHT purposes.

http://www.hmrc.gov.uk/inheritancetax/pass-money-property/pass-home-to-children.htm

dunstonh

I wondered if anyone could help here, my father wants to sell me his house for £1. He wants to do this for a few reasons: -

1 - to avoid any care costs that he may have to incur in the future
2 - so that my brother and one of my sisters, and certain grandchildren do not get their hands on the money from the property.

Sounds like a hair brained scheme to increase tax and no avoid local authority care means test due to deprivation of assets.

Can he do this, if not what can he do to make sure the house goes to me and he does not have to sell the house for care costs.

he can do it but it wont take it out of the means test. It will not take it out of the estate for IHT purposes and it would create a CGT liability when you come to sell it.

i.e. it will make matters worse, not better.