Inherited Property Issue

xylophone

In your situation, I would check with HMRC before doing anything else.

Why did you transfer the house into joint ownership when your mother died?

Surely you should have retained your interest while your father bequeathed you his interest in his will?

oldsmokie

xylophone wrote: »

In your situation, I would check with HMRC before doing anything else.

Why did yo transfer the house into joint ownership when your mother died?

Surely you should have retained your interest while your father bequeathed you his interest in his will?

Yep, I've put a phone call into them.

To be perfectly honest I don't know the answer to your questions. My father took legal advice at the time and we went with the proposed approach. I'm beginning to think this might have been a big mistake.

getmore4less

oldsmokie wrote: »

Yep, I've put a phone call into them.

To be perfectly honest I don't know the answer to your questions. My father took legal advice at the time and we went with the proposed approach. I'm beginning to think this might have been a big mistake.

AIUI joint or tenants in common makes no difference.


whats makes you think you need to include the full value?

oldsmokie

It was a response on another forum.

Essentially my father lived in the house without paying me anything for his use of my share of the house. Defies all logic and I've not managed to find reference to it in any guidance.

Savvy_Sue

I'd go with guidance, not advice on a forum ... not even THIS forum! :rotfl:

If you're not pointed to HMRC guidance which seems to fit your situation, or if it seems you do have this double whammy, it may be cost effective to pay for some financial advice you can rely on. That's the kind where you can sue the pants off them if they get it wrong.

oldsmokie

Actually it looks like the other forum poster was confusing gifts with reservation of benefit and inheritance. Thank goodness.

Nutcase243

Is there any chance of dependent relative relief applying? What was your father's situation in 1988?

Try CG65550 on HMRC website - sorry, can't post a link

John_Pierpoint

CG65550 - Private residence relief: dependent relative: introduction

TCGA92/S226

In addition to the relief which may be due on the disposal of a person's own residence relief may also be due on the disposal of a residence which has been provided for a dependent relative. But this relief is not available in respect of

• any residence acquired after 5 April 1988

or

• any residence acquired before that date unless the conditions for relief were met by that date.

The following conditions must be fulfilled.

• The dependent relative must occupy the dwelling house rent free and without any other consideration, see CG65600+.
• Only one dependent's dwelling house can qualify at any one time, see CG65660.
• A husband and wife or civil partners of each other who are living together can claim relief for only one such dwelling house between them, see CG65590+.
• The dwelling house must be the sole residence of the dependent relative, see CG65660-CG65661.
• The dwelling house must have been acquired before 6 April 1988 and the conditions above fulfilled in relation to a dependent relative before that date, see CG65670+.

CG65570+ explain what persons can be considered to be dependent relatives. In this context it should be noted that to trigger relief the dwelling house does not have to be only occupied by dependent relatives. For example, if an individual's father is a dependent relative because of his age but that individual's mother is not, occupation of a dwelling house by the individual's father can give rise to relief even if the individual's mother also resides in the dwelling house.


Somewhat unlikely I think as the property has to have been owned before 1988.


Given the massive increase in property prices since 1988 this allowance is indeed very valuable if still claimable; even more so if the property paid death duties on the half still owned by the surviving spouse.
[This is a relief where I was told that just inheriting half a house and allowing a dependant relative to live in it did not qualify - but it did in the event, there are some poorly trained "professionals" out there.?]

oldsmokie

Not sure how that would work. My parents bought their house in 1960 and they continued to live in the same property up until their respective deaths. I didn't buy a house for them to live in and that seems to the one of the requirements for this scheme. I'll have a more detailed look as I'd never heard of this relief before.

John_Pierpoint

I does not as you did not own the half until the 1990s !?
However if mum had died in 1987 you could claim that you had "provided" a free half a house for Dad, depending on dad's age (the regulation was sexist if I remember correctly) dads dependency would have been demonstrated by his need for half a house.
The legal argument revolved round the word "provided", does letting dad stay on in the family home for free count as providing for him. Well yes it did in my case contrary to the opinion of a solicitor consulted by my surviving parent who wanted to legally own 100% of the property.