Buying or signing over a property to someone else

MrChocolat

I have some spare money and I want a property for my son. I'm wondering what's the simplest way to do it. 

Buy it, then sign it over to him? 
Buy it but in his name? 
Give him the money and let him buy it himself? 

davidmcn

You can't "buy it in his name". There are good reasons why people shouldn't involuntarily end up owning property. Easiest is to give him the money. I presume there'd be no mortgage needed?

greatcrested

MrChocolat said:

I have some spare money and I want a property for my son. I'm wondering what's the simplest way to do it.
Buy it, then sign it over to him? 
Buy it but in his name? 
Give him the money and let him buy it himself? 

Assuming no mortgage involved:

1) why pay for 2 transactions?

2) Impossible. Either you buy it or he buys it.

3) Yes. Would the cash be a loan or a gift? Assuming a gift, if you die within 7 years it would still be included in your Estate for Inheritance Tax. If a loan, he would owe it to your Estate if you died. You could protect the loan via a Carge on the property.

AnotherJoe

You could sort of do (2), just instruct the solicitor that the money will come from you, but he signs everything and the purchase is made in his name, as indeed he would be buying it. I "sort of" did that when i helped my daughter out buying her house, half the money went direct from me the the solicitor.

This is not quite (3), because he never gets his hands on the cash. Of course, he could later by selling it.

AdrianC

You buy him a property.
He decides to slack off, jack his job in, take up drink/drugs.
The house gets taken to pay for his debts.

Happy?

MrChocolat

AnotherJoe said:

You could sort of do (2), just instruct the solicitor that the money will come from you, but he signs everything and the purchase is made in his name, as indeed he would be buying it. I "sort of" did that when i helped my daughter out buying her house, half the money went direct from me the the solicitor.

This is not quite (3), because he never gets his hands on the cash. Of course, he could later by selling it.

Yes that's what I mean. I would pay the money but he would sign everything as though he were buying it. If I did that, would inheritance tax be relevant? 

davidmcn

MrChocolat said:

AnotherJoe said:

You could sort of do (2), just instruct the solicitor that the money will come from you, but he signs everything and the purchase is made in his name, as indeed he would be buying it. I "sort of" did that when i helped my daughter out buying her house, half the money went direct from me the the solicitor.

This is not quite (3), because he never gets his hands on the cash. Of course, he could later by selling it.

I would pay the money but he would sign everything as though he were buying it. If I did that, would inheritance tax be relevant? 

Yes, if you die within seven years after gifting the money then it would be taken into account when assessing the value of your estate (though the value is tapered if more than two years before the date of death i.e. gifting would still be more tax-efficient than you keeping the money until you die).

Neil49

Looking at this from a different angle, if you buy him a property which is put in his name then you are suddenly taken into a care home it could be considered that you have deliberately reduced your assets that would be used to contribute towards that care. 

MrChocolat

I am going to live with him. 

MrChocolat

By the way if he did have to pay inheritance tax, does that mean he'd have to sell the property? 

Jeepers_Creepers

MrChocolat said:

I am going to live with him. 

In his house...