Land registry after death advice needed

wenger08

Hi, my father has recently passed away, we owned a property together jointly with both our names being on the deeds (and on the mortgage)

I assumed dad's half of the property would be passed to my mum, but my mum has contacted the land registry and is going to fill out a:

Deceased joint proprietor (DJP) form on the gov.uk website.

She's saying she'll fill out the form and put it all into my name.

I have some questions:

Would this then put the deeds all into my name?
What are the tax implications for me if she does this, would i have to pay inheritence tax and stamp duty for my share?

Is what we are doing the correct way to go about things, to get everything into my name without me incurring lots of costs and taxes etc?

Thanks

Keep_pedalling

How did you own the property, Joint tenants or  tenants in common? Are we talking about the marital home or some other property? 

If you held as joint tenants then you become the sole owner automatically, if not then it will pass either by his will if he had one, or by the intestacy rules 

If this is the marital home your mother would be very foolish to give her share up, and it could have significant impacts on IHT and CGT. What is the value of the property?

sheramber

Whi is we?  You and your father or you, father and mother?

Do you own the property as joint owners or as tenants in common?

If it is tenants in common did your father have a will?

If it owned jointly then there is no father's share 

The house automatically belongs to the joint owner/s.

is there still a mortgage on the property?

theartfullodger

What did the will say?

wenger08

Keep_pedalling said:

How did you own the property, Joint tenants or  tenants in common? Are we talking about the marital home or some other property? 

If you held as joint tenants then you become the sole owner automatically, if not then it will pass either by his will if he had one, or by the intestacy rules 

If this is the marital home your mother would be very foolish to give her share up, and it could have significant impacts on IHT and CGT. What is the value of the property?

Thanks. Sorry should have been more clear. It is a property we rent out, it is not the family/marital home. We were joint tenants.

So when you say it will pass to me automatically, does this mean i dont have to fill out a DJP form for this at all then? Or should i fill one put anyway?

"If this is the marital home your mother would be very foolish to give her share up, and it could have significant impacts on IHT and CGT. What is the value of the property?"

Just on this 2nd question you asked, what would be the best way to avoid IHT and CGT if my mum was to pass away? She is talking about gifting me 25% of the family home as well, would i then have to pay IHT and CGT on this? She says that if she doesnt pass away for 7 years then i dont have to pay anything on this gift, is that correct? (i have asked her to ask solicitors advice but shes adamant she knows what shes doing!)

Thanks

wenger08

sheramber said:

Whi is we?  You and your father or you, father and mother?

Do you own the property as joint owners or as tenants in common?

If it is tenants in common did your father have a will?

If it owned jointly then there is no father's share 

The house automatically belongs to the joint owner/s.

is there still a mortgage on the property?

We is me and my mum
Joint owners
ah i see, i think thats what keep_peddaling just confirmed above too

Yes there is still a mortgage on the property. I pay the mortgage and have been for 7/8 years

wenger08

theartfullodger said:

What did the will say?

Not sure to be honest, my mum knows and i dont want to ask as its not really something i care for. She knows what he wanted and i dont really care to ask her as i feel its non of my business. 

I just want to make sure shes not doing something wrong that later has huge tax implications for her or me etc
My dad handled all this kind of stuff but im just making sure shes not doing something wrong legally or tax wise. 

p00hsticks

wenger08 said:

Keep_pedalling said:

How did you own the property, Joint tenants or  tenants in common? Are we talking about the marital home or some other property? 

If you held as joint tenants then you become the sole owner automatically, if not then it will pass either by his will if he had one, or by the intestacy rules 

If this is the marital home your mother would be very foolish to give her share up, and it could have significant impacts on IHT and CGT. What is the value of the property?

Just on this 2nd question you asked, what would be the best way to avoid IHT and CGT if my mum was to pass away? She is talking about gifting me 25% of the family home as well, would i then have to pay IHT and CGT on this? She says that if she doesnt pass away for 7 years then i dont have to pay anything on this gift, is that correct? (i have asked her to ask solicitors advice but shes adamant she knows what shes doing!)

Thanks

Unless you are also living in the family home , gifting a share to you will immediately start the CGT clock ticking for you. And unless she starts paying you a market rent to live in your share, then it is a 'gift with reservations of benefit' and so doesn't fall out of her estate for IHT purposes. 

In general it's not usually  good move to give away the home you are living in - it leaves you vulnerable and is often done to avoid scenarios which wouldn't apply anyhow - is her estate likely to be over £1 million ? If not, she' probably worrying unnecessarily, If it is she can afford to pay for proper legal advice. 

Keep_pedalling

wenger08 said:

Keep_pedalling said:

How did you own the property, Joint tenants or  tenants in common? Are we talking about the marital home or some other property? 

If you held as joint tenants then you become the sole owner automatically, if not then it will pass either by his will if he had one, or by the intestacy rules 

If this is the marital home your mother would be very foolish to give her share up, and it could have significant impacts on IHT and CGT. What is the value of the property?

Thanks. Sorry should have been more clear. It is a property we rent out, it is not the family/marital home. We were joint tenants.

So when you say it will pass to me automatically, does this mean i dont have to fill out a DJP form for this at all then? Or should i fill one put anyway?

It passes to you by survivorship, so does not form part of his estate that can be willed (although it does form part of his estate for IHT purposes). You should still complete the DJP.

"If this is the marital home your mother would be very foolish to give her share up, and it could have significant impacts on IHT and CGT. What is the value of the property?"

Just on this 2nd question you asked, what would be the best way to avoid IHT and CGT if my mum was to pass away? She is talking about gifting me 25% of the family home as well, would i then have to pay IHT and CGT on this? She says that if she doesnt pass away for 7 years then i dont have to pay anything on this gift, is that correct? (i have asked her to ask solicitors advice but shes adamant she knows what shes doing!)

Thanks

Assuming you no longer live there, gifting any part of the family home does not help with IHT planning as it will be classed as a gift with reservation of benefit, so will not be subject to the 7 year rule for gifting and could lumber you with a CGT liability further down the line. If she has more in savings than she will need to live comfortable for the rest of her life cash gifts are a better option. 

Everything your father left to you mother is exempt from IHT, and if everything went to her she would have up to £1M in exemptions, this will however be reduced by his share of the house passing to you. His estate has a £325k NRB and any unused amount of this can be transferred to your mother’s estate. His share of the house you jointly own will eat into this, and it will be wiped out entirely if it is worth £325k or more. If it is worth more than £325k then IHT will be due on his estate. 

Tiglet2

wenger08 said:

Keep_pedalling said:

How did you own the property, Joint tenants or  tenants in common? Are we talking about the marital home or some other property? 

If you held as joint tenants then you become the sole owner automatically, if not then it will pass either by his will if he had one, or by the intestacy rules 

If this is the marital home your mother would be very foolish to give her share up, and it could have significant impacts on IHT and CGT. What is the value of the property?

 It is a property we rent out, it is not the family/marital home. We were joint tenants.

@p00hsticks

OP confirmed it wasn't the family home

wenger08

p00hsticks said:

wenger08 said:

Keep_pedalling said:

How did you own the property, Joint tenants or  tenants in common? Are we talking about the marital home or some other property? 

If you held as joint tenants then you become the sole owner automatically, if not then it will pass either by his will if he had one, or by the intestacy rules 

If this is the marital home your mother would be very foolish to give her share up, and it could have significant impacts on IHT and CGT. What is the value of the property?

Just on this 2nd question you asked, what would be the best way to avoid IHT and CGT if my mum was to pass away? She is talking about gifting me 25% of the family home as well, would i then have to pay IHT and CGT on this? She says that if she doesnt pass away for 7 years then i dont have to pay anything on this gift, is that correct? (i have asked her to ask solicitors advice but shes adamant she knows what shes doing!)

Thanks

Unless you are also living in the family home , gifting a share to you will immediately start the CGT clock ticking for you. And unless she starts paying you a market rent to live in your share, then it is a 'gift with reservations of benefit' and so doesn't fall out of her estate for IHT purposes. 

In general it's not usually  good move to give away the home you are living in - it leaves you vulnerable and is often done to avoid scenarios which wouldn't apply anyhow - is her estate likely to be over £1 million ? If not, she' probably worrying unnecessarily, If it is she can afford to pay for proper legal advice. 

Thanks. Yes im living in the family home and always have been. Does this change things in terms of her gifting?