IHT help wanted please

lesleymarr

please help. I live with my child in a house that I own in London. I also own 12 lock-up garages which I let out, to provide an income. I wonder, should I put the garages into a trust to ameliorate IHT so that my only child will not have to sell her own home to pay IHT? If I did, what sort of trust?
and if the garages are in trust, will I still be able to collect income from them?
if I need to sell them, will the trust make it difficult?
If my child marries then divorces, can her ex- claim a share of the property?
the garages are worth about 180,000 all together, maybe, who knows.
I went to see a solicitor to make an appointment to get advice this afternoon but I don't have much confidence in him; I suspect I am due a hard-sell session of other products they offer. oh no!

Yorkshireman99

lesleymarr wrote: »

please help. I live with my child in a house that I own in London. I also own 12 lock-up garages which I let out, to provide an income. I wonder, should I put the garages into a trust to ameliorate IHT so that my only child will not have to sell her own home to pay IHT? If I did, what sort of trust?
and if the garages are in trust, will I still be able to collect income from them?
if I need to sell them, will the trust make it difficult?
If my child marries then divorces, can her ex- claim a share of the property?
the garages are worth about 180,000 all together, maybe, who knows.
I went to see a solicitor to make an appointment to get advice this afternoon but I don't have much confidence in him; I suspect I am due a hard-sell session of other products they offer. oh no!

You need to see a solicitor who is a trust specialist and a STEP member. You also need to make sure you have a will.

Margot123

If your will sets up a testamentary trust, then that won't come into effect until after your death. If however you want to set up a separate trust to be effective during your lifetime, then you need to seek advice as already suggested.
There is a lot of property and money to be considered, I would have thought paying a professional would be rather prudent.

Yorkshireman99

Margot123 wrote: »

If your will sets up a testamentary trust, then that won't come into effect until after your death. If however you want to set up a separate trust to be effective during your lifetime, then you need to seek advice as already suggested.
There is a lot of property and money to be considered, I would have thought paying a professional would be rather prudent.

Essential! The OP needs to realise that the trust is likely to have to pay tax on the income and he will probably have to pay tax on what the trust pays him. Not a DIY job!

Crabapple

Any assets put into trust would no longer be under your control so you wouldn't get to make decisions like selling them.

If you continued to take the income then it's a gift with reservation and doesn't leave your estate for IHT purposes.

You need to find out what your estates tax liability might be and get advice on options that could work. As well as legal advice look at a good Independent financial advisor.

badmemory

How much is your home worth? How much IHT can be saved with the new relief passing a home direct to a child? Have you any IHT allowance left from the death of a spouse? Have you any savings which would allow the IHT to be paid without touching any property. And (I think finally) how old is the child now - much under 18 and I suspect you have bigger problems than IHT.

Keep_pedalling

Hopefully by the time you die your child will have a house of their own, so any IHT due on your estate won't effect their living arrangements.

How much is your current house worth and what is your marital status?