Gifting house title to son

lance44

I'm a pensioner owning my own house and wish to transfer the ownership to my only son.The reason being that on the state pension I have no chance of maintaining the property,the house being in need of quite a lot of work to keep it in good order.
He is already named in my will as my sole beneficiary and I thought it only right that he own the property if he is going to maintain it while I'm living in it.I'm aware of some of the snags in this and a solicitor would draw up the necessary documentation to ensure my security of tenure until I die.

Comments/advice please.

ognum

Will you be paying rent, your son will be your landlord so needs to be aware of his responsibilities as such or this could be considered adeprivation of assets at sometime in the future

Annisele

Wouldn't it be easier to just ask your son for help with the maintenance costs? Or to have him lend you the money to do the work, with the loan secured on your house?

As you've suggested, there are a lot of snags with the idea of gifting the property to you son - both for you and for him.

lance44

I shall not be paying any rent and hoping I have many years yet the maintenance will be ongoing over the years.

sandsni

If you were my elderly parent I would be helping you with maintenance costs regardless of whose name was on the deeds. If he's your only son and sole heir then he doesn't even have to worry about family squabbles later. Does your son know you are worrying about the cost of maintaining the house?

Have you looked into other benefits you might be entitled to such as pension credit?

ognum

lance44 wrote: »

I shall not be paying any rent and hoping I have many years yet the maintenance will be ongoing over the years.

If you do not pay rent then there will be doubt in the eyes if the tax authorities and if you need future care in your older age that this has not just been a tax dodge and the house may well still be deemed as yours.

You really do need advice from a professional in these matters or you may no end up doing what you want and think you have done.

Seek good advice!

[Deleted User]

lance44 wrote: »

hoping I have many years yet

Deprivation of assets should be a consideration however as long as you are currently fit and healthy and are not expecting to need residential care it shouldn't be a major concern. If you are expecting to need residential care in future due to current issues (for example you have a diagnosed condition) this may be looked upon as deliberate deprivation of assets and you need to tread very carefully.

This factsheet from Age UK covers most of the relevant information and will better prepare you for this decision: http://www.ageuk.org.uk/Documents/EN-GB/Factsheets/FS40_deprivation_of_assets_in_the_means_test_for_care_home_provision_fcs.pdf

xylophone

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

See also the above.

00ec25

you continue to live in it but do not pay rent so for IHT purposes the property remains part of your estate on your death
but the son is the legal owner and does not live there so he WILL be exposed to capital gains tax when he sells up

this is called the tax double whammy as the same property is (potentially) taxed twice when you die and is a clear reason why you should take professional advice on your plans. There is no advantage to your son become owner now since he is sole beneficiary anyway, but there are considerable disadvantages to your plan

Mojisola

00ec25 wrote: »

you continue to live in it but do not pay rent so for IHT purposes the property remains part of your estate on your death
but the son is the legal owner and does not live there so he WILL be exposed to capital gains tax when he sells up

this is called the tax double whammy as the same property is (potentially) taxed twice when you die and is a clear reason why you should take professional advice on your plans. There is no advantage to your son become owner now since he is sole beneficiary anyway, but there are considerable disadvantages to your plan

Added to which - if your son needs to claim means tested benefits, he won't be able to because he has capital tied up in your home. If his need became longterm, he might have to sell the house, leaving you homeless.

InMyDreams

lance44 wrote: »

I thought it only right that he own the property if he is going to maintain it while I'm living in it.

Why? Given that you and he expect him to inherit it eventually anyway, where is the advantage to your son in owning it now while he is not living in it nor gaining any rental income from it? What is it that you are actually hoping to achieve?

I agree with the above posters. Tread very carefully and get proper advice (rather than just from strangers on an Internet forum) or this may backfire big time.