Buying parents house form them ?

M635

Problem resolved.

noh

M635 wrote: »

If you can't see the upside for my parents,(which is why they've asked us to do this, and isn't a materialistic reason) I really do feel sorry for you.
My parents want us to have a homes to enjoy with our families as they did with us, and thats the only motive. We have a close family, sorry you don't.

Then work and save so as to provide for yourself rather than putting your parents future in jeopardy.
There really is no upside for your parents and someone in in a close caring family would dissuade their parents for taking this course of action.

Professional

I'm afraid the majority here have failed to understand the dynamics of M635's situation. On the family his parents are getting on and they want to help their son's onto the property ladder. They are willing to take the risk of less capital in their family home in order to allow for each of the brothers to get their own home. All the small details people are bringing up are mainly irrelevant. It's a good idea for progression. For those who just want security grow some balls.

Tax wise - I believe you're entitled to a gift of up to £325k before tax. If your parents live beyond 7 years its a "Potentially Exempt Transfer" and you pay no inheritance tax. That is subject to them having no direct interest in the gift. For example if they were to give you the home outright but continued living in it they would have an interest in it and therefore it would be liable for inheritance tax. It gets even more complicated. If you sell your home and your parents legally now live in your home then they must pay the market value rent otherwise they are living in a pre-owned asset and will be liable for income tax.

Whilst I've studied law I'm not a pracitising solicitor. It's fairly complicated so you may be worth your while seeking proper legal advice.

You can find general information here: http://www.hmrc.gov.uk/inheritancetax/pass-money-property/pass-home-to-children.htm

lincroft1710

Professional wrote: »

On the family his parents are getting on

His mother's only 59!!

CLAPTON

Professional wrote: »

I'm afraid the majority here have failed to understand the dynamics of M635's situation. On the family his parents are getting on and they want to help their son's onto the property ladder. They are willing to take the risk of less capital in their family home in order to allow for each of the brothers to get their own home. All the small details people are bringing up are mainly irrelevant. It's a good idea for progression. For those who just want security grow some balls.

Tax wise - I believe you're entitled to a gift of up to £325k before tax. If your parents live beyond 7 years its a "Potentially Exempt Transfer" and you pay no inheritance tax. That is subject to them having no direct interest in the gift. For example if they were to give you the home outright but continued living in it they would have an interest in it and therefore it would be liable for inheritance tax. It gets even more complicated. If you sell your home and your parents legally now live in your home then they must pay the market value rent otherwise they are living in a pre-owned asset and will be liable for income tax.

Whilst I've studied law I'm not a pracitising solicitor. It's fairly complicated so you may be worth your while seeking proper legal advice.

You can find general information here: http://www.hmrc.gov.uk/inheritancetax/pass-money-property/pass-home-to-children.htm

it's good you said your were not a practicing solicitor

M635

Problem resolved

noh

Professional wrote: »

I'm afraid the majority here have failed to understand the dynamics of M635's situation. On the family his parents are getting on and they want to help their son's onto the property ladder. They are willing to take the risk of less capital in their family home in order to allow for each of the brothers to get their own home. All the small details people are bringing up are mainly irrelevant. It's a good idea for progression. For those who just want security grow some balls.

Tax wise - I believe you're entitled to a gift of up to £325k before tax. If your parents live beyond 7 years its a "Potentially Exempt Transfer" and you pay no inheritance tax. That is subject to them having no direct interest in the gift. For example if they were to give you the home outright but continued living in it they would have an interest in it and therefore it would be liable for inheritance tax. It gets even more complicated. If you sell your home and your parents legally now live in your home then they must pay the market value rent otherwise they are living in a pre-owned asset and will be liable for income tax.

Whilst I've studied law I'm not a pracitising solicitor. It's fairly complicated so you may be worth your while seeking proper legal advice.

You can find general information here: http://www.hmrc.gov.uk/inheritancetax/pass-money-property/pass-home-to-children.htm

Most of what you have written is rubbish.
His parents aren't getting on his mum is only 59.
There is no gift tax in the UK. Gifts of any amount can be made without any tax being due on the gift.
Gifts may have inheritance tax implications. In this case it is clear that the parents are not in a financial position to be able to afford a gift of £100k and their estate will not reach the IHT threshold.

The whole plan is detrimental to the parents future and has very little advantage for the 3 sons as highlighted by kingstreet in the duplicate thread here https://forums.moneysavingexpert.com/discussion/3719021

noh

M635 wrote: »

Professional - Very much appreciated, actual question answered and you seem to get what I'm saying, and exactly what I wanted to know, Question resolved, thank you.

Noh, Thanks for your learned advice.... just reading through your other 'opinions' on this forum, you really should get out the house more, or even better, know something on the subject you are commenting on.

Perhaps I should get out of the house more but at least it is a house I saved for myself and paid for completely by myself.
It is plain to see I do know more than yourself but that is irrelevant as you seem determined to take the worst course of action for your parents future welfare.

M635

noh... he hasn't actually mentioned 'gift tax' in his post.

0/10 for relevance again.

lincroft1710

I can't see the point of getting £33,333.33 as a deposit for a house if you're going to repay a mortgage on another house you don't occupy and have had to have found a deposit before you could obtain that mortgage.