Signing over Deeds

xxxdarlingxxx

Hi there

I was hoping for some advice, my parents are both in their late 70's and live in North Scotland. They want to transfer their home over to myself, mainly for personal reasons, but also to avoid it being sold to meet nursing care costs .

How simple a processes is this ? Will it be costly ?

Is it just a case of the house deeds being transferred (with a condition they have "A Life Rent") to my name.

Will there be any tax implications ?
I will not be collecting any "rent" or making any income from it.

Would I have to pay Capital Gains tax ?

Financially is it better to inherit ?

Personally I am happier that they would spend the money on care if required but they are both very stubborn and have their minds made up.

There are various family reasons for sorting it all out now.

A ghastly subject and not one of my choosing.


Many thanks

BobProperty

xxxdarlingxxx wrote: »

....but also to avoid it being sold to meet nursing care costs .....

I don't know the rules in Scotland but I would suspect that they are "depriving" themselves of "assets" so you risk the arrangement being challenged.

seven-day-weekend

Right, Ok.

First of all let me say that I don't know if the law is the same in Scotland as it is in England.

Firstly, if they have to go into care it may be deemed that they have deliberately deprived themselves of assets and will be treated as though they still have the asset.

Secondly, for the purposes of Inheritance Tax (if their estate is worth over £600k) then if you do not charge them a Market Rent then it is classed as a Gift with Reservation and will not serve to take them out of the IHT bracket. You will also be expected to pay Income Tax on the profit from the rent.

Thirdly, if you sell the house and it has never been your main home, you may have to pay Capital Gains Tax on it.

It is not as straightforward as it may appear. I suggest you and your parents take professional advice.

Hope this helps.

xxxdarlingxxx

BobProperty wrote: »

I don't know the rules in Scotland but I would suspect that they are "depriving" themselves of "assets" so you risk the arrangement being challenged.

Hi there

My folks are aware that there is a 7 year wait in Scotland for this not to be the case.

Thanks for replying

xxxdarlingxxx

seven-day-weekend wrote: »

Right, Ok.

.......................Inheritance Tax (if their estate is worth over £600k) then if you do not charge them a Market Rent then it is classed as a Gift with Reservation and will not serve to take them out of the IHT bracket. You will also be expected to pay Income Tax on the profit from the rent.

Thirdly, if you sell the house and it has never been your main home, you may have to pay Capital Gains Tax on it.

It is not as straightforward as it may appear. I suggest you and your parents take professional advice.

Hope this helps.

Thanks, the estate will be no where near £600k.

I will be booking a solicitors appointment soon but I was just wondering about the complexitys

Many thanks