Gifting half my house to avoid IHT

Tom2023

Thanks for all the advice. I think I need to go see someone who specialises in tax minimisation for individuals.

km1500

Tom2023 said:

I want to minimise the IHT that my kids have to pay when I die.

ATM my house is valued at around £500k so the liability is around £60k.

My youngest lives in the house. I don't actually live in it. I live with my new wife and am registered at her house.

Would gifting my youngest say half the house as a tenant in common mean no IHT would be libel on my new £250k estate?

Thanks in advance for any advice.

you will have effectively given your son 250k and you say you are aware of the 7 year rule regarding this

the remaining 250k you hold as tenants in common will form part of your estate in the normal way when the time comes.

diystarter7

Hi OP
I'm a bit confused by exactly what you want, you have etc

However, from what you said, my advice would be to you and others that are gidting etc:

What will happen if your partner kicks you out?
What will happen if your son is declared bankrupt, sued etc, gets into gambling/wrong people etc etc
What if he got married and then had kids and divorced.

I'm sure the above wont happen but at times life does not go to plan.

Then the tax rules could easily change.

Either way, good luck with the professional and I hope they tell you about the risks.

Unless you have money, another property to fall back on, I'd think really hard about this

Take care

macman

Your kids won't have to pay any IHT. IHT is payable (if due) by the estate, before any distributions to the beneficiaries can take place.

LegallyLandlord

I suggest you get proper legal advice as there are so many variables and potential CGT to pay. As others have said, rules change, and even potentially exempt transfers (such as this) only work in full if you live 7 years after the gift. 

https://www.gov.uk/hmrc-internal-manuals/inheritance-tax-manual/ihtm04057