Inheritance implications of parents living with me

Keep_pedalling

https://forums.moneysavingexpert.com/discussion/comment/81855861#Comment_81855861

https://forums.moneysavingexpert.com/discussion/comment/81856992#Comment_81856992

If they are in IHT territory then it makes sense for them to pay you full market rent rent unless both your and your wife are higher rate tax payers.

An alternative solution would be for you to buy the main house and your parents purchase the annex. They would have to pay SDLT, but between you it is likely that less SDLT would be payed than you would pay making the purchase on your own.

This would also avoid the added complications and obligations associated with you being their landlord.

elsien

Can’t see the vendor going for the complications of selling in two separate transactions to two different buyers, opposed to the whole lot being included t in one go - if that is the current situation.

Jude57

https://forums.moneysavingexpert.com/discussion/comment/81856992#Comment_81856992

Just to point out that you/they must inform Council Tax that they are resident. If you don't, it's an offence and attracts a hefty fine. At the very least, your parents will likely want to be added to the Electoral Roll at 'your' flat and routine data matching would reveal that they are resident. If they're not on the Electoral Roll, as well as depriving themselves of their Right to vote in any elections, it will affect their credit rating which may not be a concern but it will also affect their ability to register for GP and other NHS services. If they're registered at the IOW address, they'd only be entitled to vote there and NHS services could be limited to emergencies only on the mainland. If they do move in to your flat, let them register for Council Tax; who actually pays the bill is not the Council's concern, as long as it's paid. Presumably, their IOW flat is already categorised by Council Tax there as a second home so that nothing there needs to change.

If you're going to accept rent at any level, you're creating a tenancy with all the rights and responsibilities of the landlord/tenant relationship. You need to ensure you understand your responsibilities as a landlord, which are many and about to get more complex as the Renters Rights Act comes into force in, I believe, May this year. And if you have a mortgage, you'll need formal consent from your mortgage lender to let any part of the property. You'll also need to ensure that you inform your household insurance company as it may affect your cover. I'd suggest you head over to the Buying, Renting and Selling forum here to get more advice from the knowledgeable posters there, too, before you make any firm decisions.

silvercar

https://forums.moneysavingexpert.com/discussion/comment/81860434#Comment_81860434

I'd agree with your first paragraph. An option on the second would be to accept a payment that represents board, in the same way that some people charge their working children board for living at home. This would fall outside all landlord-tenant and income tax rules.

Mojisola

Even if your parents' money has come from inheritances your father received, it's worth them thinking about putting more of it in your mother's name.

If your father ever needed residential care, the financial assessment would count all the assets in his name as his. He would clearly be self-funding but it could leave your mother with very little regular income to manage on.

Mojisola

Also, if your father doesn't want his money to go to the state, get him to compare the cost of an LPA with the cost of you having to go to the Court of Protection to get the authority to manage his affairs should he ever lose the capability to manage.

Keep_pedalling

https://forums.moneysavingexpert.com/discussion/comment/81862289#Comment_81862289

Even worse if she is the one needing care she can’t self fund and and will be dependant on a cash strapped LA. The bulk of our savings came from an inheritance my wife was fortunate to receive but it was split 50/50 from day one, so we have been able to get all of it in ISAs twice as quickly.

The_Famous_Flame

https://forums.moneysavingexpert.com/discussion/comment/81860434#Comment_81860434

Many thanks Jude. Not as simple as I'd hoped, but nothing is!

The_Famous_Flame

Thanks Mojisola - we are discussing LPA 😊