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Selling my Nan’s house
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snowball3
Posts: 22 Forumite


My Nan is 101 yrs old and hasn’t lived in her own home for the last couple of years. My mum and uncle have been taking care of her. Two weeks at one and the two weeks at the others. She owns a home which is not near to either my mum or uncle. They are considering selling it. The house is worth around £450k. She has no other savings as such. My mum and uncle are both in their mid to late 70’s and are finding it a struggle to look after the house hence selling it. My Nan lost her husband 30 odd yrs ago. I understand that if they kept the house until she died inheritance tax would not apply. Would just the first £325k be tax free or would her late husbands tax free amount be taken into account?
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Good news on two fronts. Yes, your grandfather's tax free amount at current (£325K) rates would transfer to your nan, but it is likely HMRC will request sight of his will/grant of probate - which might be tricky, especially after so long.
However, even if the house is sold, your mum and uncle may still be able to claim 'extra' on top of your nan's own £325K IHT allowance. See https://www.tax.service.gov.uk/calculate-additional-inheritance-tax-threshold1 -
Her residence nil rate band would also apply even though she has moved out and the house is like to have been sold by the time she dies. Together with her NRB this gives her estate a £500k tax free exemption in her own right. Moving into care, sheltered accommodation or to be cared for in the home of relatives does not remove the RNTB.Does your nan have lasting powers of attorney in place?0
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Brynsam said:Good news on two fronts. Yes, your grandfather's tax free amount at current (£325K) rates would transfer to your nan, but it is likely HMRC will request sight of his will/grant of probate - which might be tricky, especially after so long.
However, even if the house is sold, your mum and uncle may still be able to claim 'extra' on top of your nan's own £325K IHT allowance. See https://www.tax.service.gov.uk/calculate-additional-inheritance-tax-threshold0 -
Keep_pedalling said:Her residence nil rate band would also apply even though she has moved out and the house is like to have been sold by the time she dies. Together with her NRB this gives her estate a £500k tax free exemption in her own right. Moving into care, sheltered accommodation or to be cared for in the home of relatives does not remove the RNTB.Does your nan have lasting powers of attorney in place?
it is really good news that she probably won’t have to pay iht.
Thanks for your help.0 -
read up on the downsizing and selling rules for residential nil rate band, there are some complication but from what you have said it is likely no IHT on an estate under £500k and some of that money can be spent on her care(even if staying with family).1
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OP, not directly related your question, but who is set to inherit your Nan's house? At £450K it would bump up their assets and maybe create an IHT liability in the near future. Might be worth thinking about.
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Robert_McGeddon said:OP, not directly related your question, but who is set to inherit your Nan's house? At £450K it would bump up their assets and maybe create an IHT liability in the near future. Might be worth thinking about.0
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snowball3 said:Robert_McGeddon said:OP, not directly related your question, but who is set to inherit your Nan's house? At £450K it would bump up their assets and maybe create an IHT liability in the near future. Might be worth thinking about.0
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The Attorney (s) might open an NS&I income bonds account in Nan's name - the sale proceeds could be safely held there and earn monthly income to supplement Nan's pension.
https://www.nsandi.com/income-bonds
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Linton said:snowball3 said:Robert_McGeddon said:OP, not directly related your question, but who is set to inherit your Nan's house? At £450K it would bump up their assets and maybe create an IHT liability in the near future. Might be worth thinking about.0
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