inherited a house, to sell or rent?

Amanda1970five

Hello,
New to the forum. I Have had a look about for answers but cannot find anything specific that answers my questions…

I and my kids have inherited a property worth around £170,000.00 (60%me, 20% eldest child 10% each for youngest two) the kids get there shares at 25y. (one is 21, the other two are 11y and 12y)

If I rent it i will get around £600.00 a month for it.

If i sell it - what are my options for investing this amount of money and what kind of monthly return will I get.

Any ideas or direction for me to look in is much much appreciated.
Also, how much tax will I pay? I am in receipt of child tax credit, will this be affected?

Thanks for any help

Amanda x

xylophone

If i sell it

Does the will permit you to sell it? Have you checked with a solicitor?

It appears that you are holding your children's shares in bare trust for them. Again, check with solicitor.

This would mean that any income would need to be divided in the appropriate shares and declared for tax.

Child Tax credit is income related.

http://revenuebenefits.org.uk/tax-credits/guidance/how-do-tax-credits-work/what-is-income/property-income/

You would be well advised to take professional advice.

Amanda1970five

Hi,
..yes Im permitted to sell it, and yes holding the children's shares in trust.
Ill take a look at the link
thanks v much for replying

xylophone

IAs you are permitted to sell the property, and assuming the shares of the property are "indefeasibly vested" see http://www.prescient-financial.com/docs/Bare%20trust%20returns.pdf
in the children, then it appears that you will be a bare trustee.

With regard to the eldest child, who is not a minor, you may find it difficult to find a provider of an account that you can hold in bare trust.

With regard to the younger children, you should be able to hold the cash in an account in the name of each with you as trustee certainly until they are eighteen - the problem is likely to come after that.

http://www.boltburdon.co.uk/private-clients/wealth-planning/trusts/bare-trust/

Mojisola

Amanda1970five wrote: »

Hello,
New to the forum. I Have had a look about for answers but cannot find anything specific that answers my questions…

I and my kids have inherited a property worth around £170,000.00 (60%me, 20% eldest child 10% each for youngest two) the kids get there shares at 25y. (one is 21, the other two are 11y and 12y)

I didn't think you can make this restriction any more. Aren't beneficiaries allowed to get their inheritance as soon as they reach 18?

Amanda1970five

hi, the will states 25years, Im not making the restriction personally, the will states that.

Pincher

There's something called Deed of Variation.

If you really want to, you can request to do something else.
For example, it seems to me eminently sensible to use the money for university.

I meant the kids, not you going to university.
Well, hmm.....

Amanda1970five

hi, thanks for that info, Ill look into it

the real issue I have at the moment is more concerned with deciding which is more financially beneficial - to sell or rent and if I sell how the money can best be invested.

justme111

Why don't you go to house selling and renting board andnread renting stickies there. You may decide it is too much hassle/nonviable option.

Keep_pedalling

Amanda1970five wrote: »

hi, the will states 25years, Im not making the restriction personally, the will states that.

Although it states that, there is nothing to stop your adult child claiming his inheritance now, and as the trustee you have the power to distribute some or all of of the eldest child's inheritance before he reaches 25. The younger children will be in the same position once they get reach the age of 18.

somethingcorporate

£7,200 gross income on a £170k house is pitiful. Once you factor in voids/repairs/LL insurance etc the return is going to be minimal.

I'd suggest selling and investing would be a far better option (this is not the right thread for discussing how to invest such large sums).