Termination of Life Rent and Property Transfer

PaulFraser

My father’s second wife had life rent in the family home (Scotland) after his death in 2020. Recently she also passed away and the solicitor is now going to terminate the trust and transfer the house into the ownership of my brother and myself. We anticipate that he will probably buy me out in the New Year and live in the house.

Are there any pitfalls (tax, mostly, although I assume that inheritance tax applies here) that we need to be aware of? Thanks.

Keep_pedalling

If he is going to buy you out or you are planning on selling I don’t see any point having it put in your name especially if this will take away your first time buyers status.

Your step mother was the beneficial owner so any IHT falls on her estate although her estate will be able to claim any unused NRB allowances from your father’s estate.

PaulFraser

Keep_pedalling said:

If he is going to buy you out or you are planning on selling I don’t see any point having it put in your name especially if this will take away your first time buyers status.

We discussed that but he’s not ready to commit yet (he and his partner are selling their house in the New Year).