Inherited house

theoretica

Mojisola said:

Did the solicitor suggest the option of making you a 'joint tenant' owner now?

You would automatically inherit the house and it wouldn't be part of Nan's estate so your mother couldn't challenge it.

If considering that, they should get advice about the potential CGT bill on the gift - not good to cause one problem while trying to avoid another.

Savvy_Sue

theoretica said:

Mojisola said:

Did the solicitor suggest the option of making you a 'joint tenant' owner now?

You would automatically inherit the house and it wouldn't be part of Nan's estate so your mother couldn't challenge it.

If considering that, they should get advice about the potential CGT bill on the gift - not good to cause one problem while trying to avoid another.

Potential CGT - but surely not if Mum has been living in the house? 

Also I wanted to check that OP is over 18: I'm fairly sure from reading first post that they must be. 

Keep_pedalling

Savvy_Sue said:y

theoretica said:

Mojisola said:

Did the solicitor suggest the option of making you a 'joint tenant' owner now?

You would automatically inherit the house and it wouldn't be part of Nan's estate so your mother couldn't challenge it.

If considering that, they should get advice about the potential CGT bill on the gift - not good to cause one problem while trying to avoid another.

Potential CGT - but surely not if Mum has been living in the house? 

Also I wanted to check that OP is over 18: I'm fairly sure from reading first post that they must be. 

If you gift a property you are not living in to a connected person then the CGT rules apply. So if for example your Nan had moved out several years age then the property was worth £400k and she gifts it when it is worth £500k the CGT will apply to the £100k increase in value and it would be your Nan who would be liable to pay the tax.

If she had moved out more recently and there is no increase in value the there would be no liability. 

Beckz1205

Thanks for all the replies, yes I am over 18 by several years haha. My nan moved out of the house 13 ish years ago when she remarried and then mother moved in. 

Keep_pedalling

Beckz1205 said:

Thanks for all the replies, yes I am over 18 by several years haha. My nan moved out of the house 13 ish years ago when she remarried and then mother moved in. 

Then gifting the house would certainly involve CGT.

 Does she also have a financial interest in the house she is living in? Is her husband still alive? Are her total assets high enough to bring her estate into IHT territory? 

doodling

Hi,

If your mother is given a life interest in the house then it is unlikely that the will could be successfully challenged. 

The only problem I see is whether this will work practically.

You will own the house but your mother will be able to live there untill she dies.  The first thing to check is whether that life interest gives her the sole beneficial interest in the house - i.e. could your mother throw you out?

The next thing to consider is, even if your mother didn't try to throw you out, is she likely to be resentful that you got the house (albeit only after she dies)?  If your mother is the type to hold a grudge then there is a risk that you may end up having to find somewhere else to live because living in the house is unbearable (and she can't be forced to leave because of the life interest).

If you are willing to look at it in the very long term (i.e. beyond your mother's death) then it will all work out.  If the shorter term matters then you need to consider the personalities involved.

Keep_pedalling

doodling said:

Hi,

If your mother is given a life interest in the house then it is unlikely that the will could be successfully challenged. 

The only problem I see is whether this will work practically.

You will own the house but your mother will be able to live there untill she dies.  The first thing to check is whether that life interest gives her the sole beneficial interest in the house - i.e. could your mother throw you out?

The next thing to consider is, even if your mother didn't try to throw you out, is she likely to be resentful that you got the house (albeit only after she dies)?  If your mother is the type to hold a grudge then there is a risk that you may end up having to find somewhere else to live because living in the house is unbearable (and she can't be forced to leave because of the life interest).

If you are willing to look at it in the very long term (i.e. beyond your mother's death) then it will all work out.  If the shorter term matters then you need to consider the personalities involved.

This is why the will needs to be worded to prevent that happening which should be fairly straight forward for the solicitor to do. For instance the life interest could end before her death under certain conditions, such as marrying, or moving out to voluntarily. 

One other thing that needs to be addressed is what happens if the OP dies before their mother, but that is something that needs to be addressed in their own will. 

gwynlas

Your Nans solicitor appears to be well aware of consequences so I would leave it in his professional hands, presumably she is leaving her share of new marital home to her husband
 What I would say is that knowing your mother is in debt be aware that if at any time this involves bailiffs they could come to your home seeking recompense. The other downside of mother living there is that the family would expect you to become her carer should she need it in the future.
 If your Nan is happy to let people know the reasons behind her decision making she could either inform your mother and siblings now or leave a letter for after. The time she;s got left should be as stress free as possible.

doodling

Hi,

Keep_pedalling said:

doodling said:

Hi,

If your mother is given a life interest in the house then it is unlikely that the will could be successfully challenged. 

The only problem I see is whether this will work practically.

You will own the house but your mother will be able to live there untill she dies.  The first thing to check is whether that life interest gives her the sole beneficial interest in the house - i.e. could your mother throw you out?

The next thing to consider is, even if your mother didn't try to throw you out, is she likely to be resentful that you got the house (albeit only after she dies)?  If your mother is the type to hold a grudge then there is a risk that you may end up having to find somewhere else to live because living in the house is unbearable (and she can't be forced to leave because of the life interest).

If you are willing to look at it in the very long term (i.e. beyond your mother's death) then it will all work out.  If the shorter term matters then you need to consider the personalities involved.

This is why the will needs to be worded to prevent that happening which should be fairly straight forward for the solicitor to do. For instance the life interest could end before her death under certain conditions, such as marrying, or moving out to voluntarily. 

One other thing that needs to be addressed is what happens if the OP dies before their mother, but that is something that needs to be addressed in their own will. 

My suspicion is that the OP needs to be a joint beneficiary of that life interest trust if he wants the right to live there but I am not a solicitor and I don't know whether that works from a taxation and trust law perspective.

It doesn't address the "being unable to live with each other" point though, but that can't be addressed through legal means.

74jax

Where is nan's husband at the moment? 

If your mother can live in it with a life interest, does it stipulate with a contribution to bills / upkeep etc? 

Is there room if you want to move people in with you etc?