Putting house in daughter's name

freccles

I'm 70, have my own (no mortgage) terraced house in a crappy area worth approximately 150k on a good day. What are the financial implications (I'm aware of the personal ones) if I transfer the house to my daughter now instead of leaving it to her on my death? She's living with her partner and their 2 teenage children, has a mortgage and both have reasonably good jobs.

I'm getting on now and am thinking about moving into assisted living in the future (maybe 5 years or so)

RAS

Partner or spouse?

TheSpectator

Daft idea, daughter may be liable to Capital Gains tax when it's eventually sold. Inheriting it from you upon death won't.

Deprivation of assets.

400ixl

Could be lots of consequences and rarely is this a good idea.

What if you were to need care in the future, this would be seen as deprivation of assets.
If she has a property already then this would be seen as a second property and treated as such for things like council tax
She would also become responsible for any capital gains tax from the time you transfer it.

What is the reason for wanting to transfer it now? Is your estate going to exceed the inheritance tax limits?

Other will be along with more detail on the consequences.

Voyager2002

freccles said:

I'm 70, have my own (no mortgage) terraced house in a crappy area worth approximately 150k on a good day. What are the financial implications (I'm aware of the personal ones) if I transfer the house to my daughter now instead of leaving it to her on my death? She's living with her partner and their 2 teenage children, has a mortgage and both have reasonably good jobs.

I'm getting on now and am thinking about moving into assisted living in the future (maybe 5 years or so)

If you are going to continue living in it, there would be no benefit: if you go into a care home the value of the house would still be considered when assessing you for fees. Google the term "gift with reservations".

Furthermore, if your daughter ever sells her home and buys a new one (change of job?) while owning another property, she would then face an increased bill for stamp duty.

All in all a thoroughly bad idea, unless you are going to renounce the world and move into a monastery or something...

elsien

Aside from the considerations listed above,  will you not need the equity from your house in order to move into assisted-living in the future?

Other financial implications include if your daughter divorces the house would be included as an asset in any marital split. If life throws a curveball (illness redundancy) and they ever need to claim means tested benefits, the house they are not living in rules them out of those claims. You are effectively giving up your security unless you have substantial other assets.

FlorayG

OP I think the after effects might depend partly on why you want to do this. What advantages does it offer you ( that might outweigh the disadvantages)

Keep_pedalling

This would be a very silly thing to do and won’t work if this is to avoid care costs. 

freccles

Thanks all. No spouse. It was really just an idea to get everything sorted before I pop my clogs. (I'm a control freak). Also yes, with the idea that if I moved into rented accomodation eventually, I might be able to claim something towards the cost

elsien

You can’t simply give a property away and then expect the DWP to pay towards your rent. Quite rightly, it doesn’t work like that.

FlorayG

freccles said:

Thanks all. No spouse. It was really just an idea to get everything sorted before I pop my clogs. (I'm a control freak). Also yes, with the idea that if I moved into rented accomodation eventually, I might be able to claim something towards the cost

No sadly it won't work like that. Best to control things by writing a very clear will