Inheritance Tax / putting part of home in children’s names.

Albermarle

DJ23 said:

Need to do something so no IT to pay. 

Only two things certain in life - Death and taxes. In the case of IHT both at the same time !

DJ23

Keep_pedalling said:

DJ23 said:

I need to see someone well versed in such matters!!! 

     People work all their lives, are careful with money, taxed every which way and then more taxes when dying. 

    IT hasn’t gone up for 14 yrs. but house prices have.
      I’m single. I have some savings inherited from mother around £150,000 and home will need valuing. Prob in the 350,000-450,000 ball park. Needs some sprucing up.

But you have never been taxed on the gain in property value or the inheritance from your mother have you, and those are the reasons is why your estate may pay IHT. As well as the NRB you also have the residential NRB which takes your exemptions up to £500k, so at the top end of your estimate £100k would be subject to IHT, at the bottom none of of would be. 

If you are going to make gifts it would be better to do it with some of your cash savings not a share of your home. £50k each would go a long way to a deposit for their own place, a share of your home is unusable until it is sold.

Did your mother die within the last 2 years?

No 5 yrs ago

Grumpy_chap

DJ23 said:

Keep_pedalling said:

Did your mother die within the last 2 years?

No 5 yrs ago

OK - the reason for that question was most probably connected with the possibly of a DoV (Deed of Variation) to allow some of the inheritance from your Mother to pass to your sons without ever being part of your Estate.  It has a time limit of 2 years so the opportunity is passed.

I am sure Keep_Pedalling will say if there was something else they had in mind with that query.

DJ23

I’m going to shrink the cash as after abit of research and comments on here it’s prob the easiest option. 

lincroft1710

IHT threshold limits do change, house values go down as well as up. It is quite possible that your estate may be under the the threshold by the time you die

eskbanker

lincroft1710 said:

IHT threshold limits do change

You must have a good memory!

Keep_pedalling

eskbanker said:

lincroft1710 said:

IHT threshold limits do change

You must have a good memory!

Well they did change for home owning parents back in 2017. 

Keep_pedalling

Grumpy_chap said:

DJ23 said:

Keep_pedalling said:

Did your mother die within the last 2 years?

No 5 yrs ago

OK - the reason for that question was most probably connected with the possibly of a DoV (Deed of Variation) to allow some of the inheritance from your Mother to pass to your sons without ever being part of your Estate.  It has a time limit of 2 years so the opportunity is passed.

I am sure Keep_Pedalling will say if there was something else they had in mind with that query.

No, that was exactly what I had in mind.

Keep_pedalling

DJ23 said:

I’m going to shrink the cash as after abit of research and comments on here it’s prob the easiest option. 

If you shrink the cash by gifting you just need to keep breathing for another 7 years, but if you are in good health you can cover IHT arising out of an unfortunate early death with term life insurance which is something we have done.

lincroft1710

eskbanker said:

lincroft1710 said:

IHT threshold limits do change

You must have a good memory!

My first dealings with the administrative side of IHT (and its predecessors) valuations were over 50 years ago