Is this possible? Helping family

teddysmum

You, now, can't wait to live on your boat, but the novelty may wear off and you'll need somewhere to go but may not have the resources to buy a house again, if you give yours away or commit it elsewhere.


We had friends who built up their business in a boatyard and lived on a large boat, built and fitted out by themselves, to be more like a house than a boat.


However,after their toddler son nearly drowned in a test tank, they had to move to a house for safety's sake. That son is now a father or even grandfather himself, but the friends are still in their house, even though they still have the boatyard.


I think the tasks involved with boating are now too much of a challenge as they age (over 70),whereas they were fun when they were younger.

martindow

Have you lived on a boat all through the year, OP? If you're basing this on boating holidays in the spring or summer, the realities of trudging along muddy towpaths with your shopping in February can be very different.

I think the idea of a trial period of a couple of years keeping options open to see how things work out would be a good idea for both of you.

gingercordial

JJM100200 wrote: »

One other option is to just gift the house to him but again I do not know about the legal or tax Implications. If I gifted it to him I would expect him to do a full restoration on my boat though lol.

I would suggest you let him live in the house for now as your lodger, either rent-free or for a discounted rent, for a period of say one or two years. You agree that during this time he will do the full restoration of your boat. You could also ask him to save £x for a partial payment towards the house as a "deposit". Could be £5k, £10k or whatever you want.

Once the boat refurbishment is done to your satisfaction, and he has proved himself able to save, give him the house. You could either take the "deposit" from him as payment or, if you are feeling really generous and genuinely don't need it, tell him to keep it (don't tell him upfront if you're planning to do this - let it be a nice surprise). As others have explained there will be no tax consequences to this gift as long as you've been living in the house as your main residence.

Jenniefour

martindow wrote: »

Have you lived on a boat all through the year, OP? If you're basing this on boating holidays in the spring or summer, the realities of trudging along muddy towpaths with your shopping in February can be very different.

I think the idea of a trial period of a couple of years keeping options open to see how things work out would be a good idea for both of you.

OP said he/she is from a maritime/boat owning family. Doesn't sound as though this is the born and bred city dwellers equivalent of hasty "let's go and live in a nice country cottage" and then find out you hate the cows looking at you over the garden wall, or cockerels waking you up at 5 in the morning.

ThePants999

JJM100200 wrote: »

thanks for that. I will arrange a chat with a solicitor asap to see what they advise. Do you know what the situation is with tax on this type of arrangement?

Not for certain, no, but I expect you can't go far wrong if you declare the interest paid to you as income.

TBagpuss

OP, you could transfer the house to him with a private mortgage to you. As others have said, make surethat you get proper legal advice about the tems of the mortgage.

If you decided to rent to hi first, then of course you could have to ensure that you complied with the legal requirements to be a landlord - gas safety certificate, deposit (if any) properly protected, proof of right to rent and so on.

Renting the house to him for a year would allow him to work on rebuilding his credit record, you could get an idea of what normal mortgage rates might be for a property at that value and base the rent on that, which would give him a chance to see how affordable it would be for him. he could also be saving.

You would of course have to declare and pay tax on the rental income.

After a year, he could review whether he was then able to get an ordinary mortgage, and if not, and assuming you still wished to, you could sell the property to him with a private mortgage. That way, you both get to test the water, and if there are any issues with the house, or with his ability to meet the monthly payments, you and he both get to see how it works out.

JJM100200

In reply to all: sorry about not getting back to you earlier only just managed to find time to browse the site again today.

Lots of great advice and the reason why I posted the question to get a wide range of views to discover things I had not thought about. The idea is definitely still in its early stages in my mind so lots to now consider before I choose my next move.

If I am reading the replies correctly.

1) Private mortgages are perfectly legal and an arrangement we can freely enter in to if we choose that route.
2) No tax implication such as capital gains as I am selling my main and only property that I live in and have lived in for many years.
3) Gifting the property is also perfectly legal with no tax implications as it is my main home and only property.
4) Should consider other options such as allowing him to live in the house/rent it first etc though would have to comply with landlord requirements and there would be tax implications on the rent received.

Thanks for all of the time you have given to reply to me, it is very much appreciated and now gives me a good basis to decide what the next move is before seeing the legal professionals.

Have a good weekend everyone,