receiving a house as a gift

anesta

Hi, my mum died a couple of years ago and she left everything to my dad. As a result he now owns two houses (one which his main residence and now another which was the main residence of my mum). He is thinking of changing her will so that my brother and I become the owners of the house that, for tax purposes, is NOT his main residence. I don't know or understand all the implications, so I have a couple of questions, if anybody can help!
1. If I become the owner of half that house, would I have to pay some tax because I would then own or have a stake in 2 properties (one I will half own with my brother and half that I own with my wife)?
2. Could I decide to sell my half (or the whole house if my brother agrees) with no adverse tax implications for my dad?:eek:
Many thanks.

dottodot

I'm sure you'll get some far more knowledgeable replies, but from my own experience, a couple of comments...
By 'changing the will' I assume you mean getting a dead of variation drawn up. Just to say, I think that you only have 2 years from the date of death to do this, so its worth being aware of timescales.

Any tax implications will then depend on the value of your mum's estate. If it was over the Inheritance tax threshold for that year, although your dad may have been exempt as a spouse, if the will is changed, Inheritance tax could be liable. If its below the threshold, my guess would be that the only tax liable would be Capital Gains Tax by you / your brother when you come to sell.

But as I say, not an expert - just my thoughts!

getmore4less

If it's over two years it's too late to do a DOV.

The rest will depend on the value at DOD(date of death) value now, or when sold or transfered to you.

Also the total value of the mum and dads estate

You will find it very hard to sell 1/2 a house.

Who lives in the house now(and the last 2 years)?

ognum

I would post this on the House buying board as there are very knowledgable people there.

You can gift a house

Your father would be subject to a capital gains tax bill, he would need to pay CGT on the difference purchase price and current value, there are also some caveats to that like did he ever live there himself etc, was it wholly owned by your mother before her death.

If you let the house you will need to pay tax at whatever rate you pay on the rent minus allowable ExpencesDear.

How old is your father, if he needs future care there could be an issue of deprecation of assets.

As I said post on the house buying board!

anesta

Thanks for all the replies. I am going to post the same on the house-buying part of the forum!
:beer:
Anesta