Buying or signing over a property to someone else

AdrianC

MrChocolat said:

AdrianC said:

MrChocolat said:

I am going to live with him. 

Oh, it's actually just another tax scam, not really a very, very generous gift.

Thank you for your speedy assessment of my situation. But perhaps I should clarify a few things. 
...
And the last thing I want is for the taxman, who I don't give two !!!!!! about, to !!!!!! things up for my son in the future. 

By which, of course, you mean that you want to minimise the tax payable.
Nothing wrong with that. Providing it's done within the law.
But let's at least be honest and state that's what it's about.

Is there likely to be an IHT liability, even were you to die tomorrow...? Remember, the threshold is currently £325k.
Of course, by the time you do die, you may have had to pay for care costs - and such a sizable "gift" would be well within deprivation of assets scope.

And, if your son cannot work, can he afford to maintain the property? His means-tested benefits will be substantially affected by the possession of a property. Will he need residential care at some point?

greatcrested

Buy the property yourself and let him live with you.

Is your Estate (the property value plus other assets (car, clothes, investments, jewelry, helicopter etc) above the current threshold for IHT?

MrChocolat

I don't know if my estate is above or below any threshold.

If I die within 7 years of gifting my son a property or the money to buy one, will the value at that time (when I'm gone) be used in the calculation, or will it be based on the value at the time of giving it to him? 

Also if I put any property of mine in a will, does that make it exempt from inheritance tax? 

Slithery

MrChocolat said:

Also if I put any property of mine in a will, does that make it exempt from inheritance tax? 

Of course not.

AdrianC

MrChocolat said:

I don't know if my estate is above or below any threshold.

Are you worth more than £325k? Your savings, the value of all your property...? If so, a lot more, or just a snidge?

If I die within 7 years of gifting my son a property or the money to buy one, will the value at that time (when I'm gone) be used in the calculation, or will it be based on the value at the time of giving it to him?

The value of a gift is the value at the time of the gift. But remember deprivation of assets, in the event of needing residential care.

Also if I put any property of mine in a will, does that make it exempt from inheritance tax? 

No, IHT is calculated on your entire estate at the time of your death. The will simply says who gets it. If you leave "No 5, Acacia Avenue" explicitly, and it isn't owned by you at the time, they get nothing. They do not get the value. Remember that your executor may need to sell a property to pay IHT.

[Deleted User]

Wow some vicious posters tonight !! 

OP - sorry to hear your other son died  

Now you are looking the best way to help your son. 

Buy the house in his name. It doesnt sound like he will be kicking you out any time soon. 

Worry about care home costs - if that ever becomes an issue, when that ever happens, if it happens. The longer the time between selling and giving away assets , then the harder it is to prove deprivation of assets. 

Id pay for some legal advice estate planning tho, just to check this is your best move if inheritance tax is relevant in your case. 

getmore4less

Gift him 1/2, buy the house jointly no gift with reservation.

Is the son disabled? 
Is the son claiming benefits? 

greatcrested

Densol said:

Wow some vicious posters tonight !!

Nothing vicious, just a lot of information.

It's important for a poster like this to consider all the implications of his plan (financial, tax, future care etc) whether he has already thought of/asked about them or not.