Parents house deeds in my name - does it effect first time buying

Shazmataz

Hi, first time poster here!
My parents have transferred their house deeds into mine and my sisters name. As someone who is considering buying their first property, does this now mean that I’m already a (half) homeowner and any new property would be classed as a second home and liable for extra stamp duty? It’s not something that my parents (or I) thought to ask about at the time!

Anyone have any knowledge on this? I live in Scotland btw.

Thanks in advance

davidmcn

Yes, you're no longer a first time buyer for LBTT purposes, and if you buy another property then you'll need to pay the supplement for buying an additional residential property.

Why did they transfer the house into your names? It may not even have achieved whatever they hoped it would.

sal_III

It's not your parent's house, it's your house, your parents happen to live in it.

You are not liable for "extra" SDLT, you are simply not eligible for First Time Buyer discount.

xylophone

My parents have transferred their house deeds into mine and my sisters name.

Are they continuing to live in the property?

If so, are they paying you and your sister a market rent?

https://www.mygov.scot/inheritance-tax-support/

Are they hoping to avoid care home fees?

See Paying for a Care Home 2019-20 Edinburgh Council p23/24

if you have moved an asset or capital out of your name it does not necessarily mean that you will receive financial help from us. When deciding if you are entitled to financial help we will ask you if you have ever owned property. We do checks on transfers and we will regard a transfer of capital as deliberate if you have transferred it to someone else so that you are more likely to qualify for financial help
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davidmcn

sal_III wrote: »

You are not liable for "extra" SDLT, you are simply not eligible for First Time Buyer discount.

No, they will also be liable for the Additional Dwelling Supplement if the "parents'" house remains in the OP's name by the time they buy their own place.

Silvertabby

... and in the meantime, if you or your sister get divorced/go bankrupt the house may have to be sold in order to liquidise your/her share of the asset.

csgohan4

Why did your parents transfer the house? Did they consultant a financial advisor? Seems it seems to be more trouble than good.

theartfullodger

If this was done to fiddle tax (IHT, woteva...) or care home fees then rather amusing.

My old dad thought part of patriotism was paying the tax you should.

joanneharris

Quite simply two options... sell your share of the half you own and then you will pay standard stamp duty on your new purchase OR keep your share of the property and then you will pay the higher rate stamp duty.


Whatever you do you will not be a first time buyer anymore so you are not going to be able to able the FTB discount.