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Deed of Gift, or not?
GeorgeClare
Posts: 4 Newbie
My father passed away, leaving my mum, living in a house they shared plus a second property he inherited 7 years ago, in his sole name.. There is no mortgage and it is rented out.
My Mum is the sole executor and beneficiary of his estate.
My Mum would like my Brother and I to put the rental property in our names, but she will continue to receive the rental income from it.
We are aware of the 7 year inheritance tax rule, but not sure of how the various taxes will affect us and if it's financially worthwhile.
Can anyone offer advice please?
My Mum is the sole executor and beneficiary of his estate.
My Mum would like my Brother and I to put the rental property in our names, but she will continue to receive the rental income from it.
We are aware of the 7 year inheritance tax rule, but not sure of how the various taxes will affect us and if it's financially worthwhile.
Can anyone offer advice please?
0
Comments
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That would be a gift with reservation of benefit so the 7 year rule would not kick in and the rental property would not fall out of the estate. You would also face a possible CGT liability when it was eventually sold.What is the total value of her estate? If it is over £1M then a better option would be to sell the inherited property and gift some of the proceeds instead. If it is not then just leave things as they are.2
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Plus if you don't currently own a property and decide to buy one in the future you will have lost anyy FTB benefits.Out of interest, under your proposal:* who would be the 'landlord'?* who would receive (and pay income tax on) the rent?2
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Thank you for your advice and information. This has helped us make a decision and understand the implications involved. 😊0
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