Selling house to child

mackin01

Hi, I was looking for advice on the cheapest way to sell the current family home to my child.  She is paying for the house but not the full market value.  Looking for advice on having minimal contact with solicitors and their fees and the potential to use a conveyancer.  We are based in Scotland.  Any advice welcome, thanks

user1977

Is she moving in / already living there? If not then you/her may wish to consider whether it's wise to do.

Is she buying with a mortgage?

mackin01

Thanks for the response.  She already lives in the house and no wont require a mortgage, she has enough savings.

Bookworm105

mackin01 said:

Thanks for the response.  She already lives in the house and no wont require a mortgage, she has enough savings.

then DIY it
no idea how easy it is to use the Scottish equivalent of the English land registry, but presumably they provide online guidance in the same manner (doubtless caveated, as with the English one, that professional advice is wiser)

dinosaur66

unfortuanatley i think you need a solicitor /financial advisor in this case as the tax law is more complciated than it ever should be for your situation .

capital gains definatley /stamp duty ? not sure /gifting law .

but i have found scotland solictors /conveyancing very good ( cheap ) and they have a set price range depending on the house price.

its rediculous that we have to pay tax and govt want money on something that should be ours to do as we want with especially for our own family

user1977

Bookworm105 said:

mackin01 said:

Thanks for the response.  She already lives in the house and no wont require a mortgage, she has enough savings.

then DIY it
no idea how easy it is to use the Scottish equivalent of the English land registry, but presumably they provide online guidance in the same manner (doubtless caveated, as with the English one, that professional advice is wiser)

It's not particularly user-friendly.

I should also have asked if there are any securities still to be discharged from your title, and whether the title is already on the Land Register? If it's a first registration (i.e. transfer from the Register of Sasines) then she's more likely to need a solicitor.

But if registered then you'll need to sign a Disposition (i.e. the deed transferring ownership - unfortunately no standard form for that, she'll need to find an example somewhere and type it up with the relevant details), and she then registers that at the Land Register. She'll also need to submit a Land and Buildings Transaction Tax return (and pay any LBTT due) - more info here.

TheSpectator

Before you go to the lengths of incurrings costs on this, what is the purpose of this exercise?

It may be that what you are trying to achieve can't be done easily. You call itbthe 'family home' - do you live there? Continue to live there?

mackin01

user1977 said:

Bookworm105 said:

mackin01 said:

Thanks for the response.  She already lives in the house and no wont require a mortgage, she has enough savings.

then DIY it
no idea how easy it is to use the Scottish equivalent of the English land registry, but presumably they provide online guidance in the same manner (doubtless caveated, as with the English one, that professional advice is wiser)

It's not particularly user-friendly.

I should also have asked if there are any securities still to be discharged from your title, and whether the title is already on the Land Register? If it's a first registration (i.e. transfer from the Register of Sasines) then she's more likely to need a solicitor.

But if registered then you'll need to sign a Disposition (i.e. the deed transferring ownership - unfortunately no standard form for that, she'll need to find an example somewhere and type it up with the relevant details), and she then registers that at the Land Register. She'll also need to submit a Land and Buildings Transaction Tax return (and pay any LBTT due) - more info here.

Thanks, I am learning as I go along here.  I am just in the process of paying of the mortgage and will then need to complete the discharge.  The property is already on the Land Register, sononething that could make the process easier then.  I will have a read of the info provided.

mackin01

dinosaur66 said:

unfortuanatley i think you need a solicitor /financial advisor in this case as the tax law is more complciated than it ever should be for your situation .

capital gains definatley /stamp duty ? not sure /gifting law .

but i have found scotland solictors /conveyancing very good ( cheap ) and they have a set price range depending on the house price.

its rediculous that we have to pay tax and govt want money on something that should be ours to do as we want with especially for our own family

100% agree, everyone wants their cut and it seems so complicated when you struggles to understand the language used!

mackin01

TheSpectator said:

Before you go to the lengths of incurrings costs on this, what is the purpose of this exercise?

It may be that what you are trying to achieve can't be done easily. You call itbthe 'family home' - do you live there? Continue to live there?

The purpose is to make sure the property is in her name as once complete she will be living their alone and it will be her home.  As I could I wanted to help her get on the property ladder without needing a mortgage.

Bookworm105

mackin01 said:

TheSpectator said:

Before you go to the lengths of incurrings costs on this, what is the purpose of this exercise?

It may be that what you are trying to achieve can't be done easily. You call itbthe 'family home' - do you live there? Continue to live there?

The purpose is to make sure the property is in her name as once complete she will be living their alone and it will be her home.  As I could I wanted to help her get on the property ladder without needing a mortgage.

so it has been and will be your main home for your entire ownership period until sold to daughter?.
if true then CGT is irrelevant for you as you get 100% private residence relief on the sale 
if you have in fact already moved out and live elsewhere then CGT may apply to you if it takes more than 9 months between you moving and she completing on the purchase. (If CGT applies to you then your sale price is market value, not what she pays you).

what she pays for it is a private matter between you and her.

although if she were ever to move out of it whilst still owing it and, for example, either treats it as a second home or she starts letting it in the future then, for tax purposes when she finally sells it, she would be deemed to have acquired it at the market value at date of "purchase", not what she paid in money. Therefore, it would be wise to get adequate evidence of its current market value and file that way for future use. 


also bear in mind if you think this is protecting you from care home fees then it is not 100% certain. Yes of course she would have the money from the sale, but the discount you give her may still be treated as deprivation of capital if she needs to claim care home costs