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    • Pat Clayton
    • By Pat Clayton 4th Jan 18, 7:29 PM
    • 2Posts
    • 0Thanks
    Pat Clayton
    IHT advice
    • #1
    • 4th Jan 18, 7:29 PM
    IHT advice 4th Jan 18 at 7:29 PM
    If I were to sell my house and downsize to two flats (maximum 425K each), putting one in my name and the other in my 47 year old unmarried daughter's (only dependent), how would this affect the IHT situation ?

    a) if I live seven years ?
    b) if I don't ?
    c) if my daughter dies before me.

    Any advice would be greatly appeciated.Thanks
Page 1
    • TARDIS
    • By TARDIS 4th Jan 18, 7:50 PM
    • 111 Posts
    • 80 Thanks
    • #2
    • 4th Jan 18, 7:50 PM
    • #2
    • 4th Jan 18, 7:50 PM
    Probably better putting this in the cutting tax forum, but I'll have go anyway

    A) if you live 7 years and don't benefit from the flat in her name ie don't live in it or pocket the rental profits I think you should be fine (please note I am in no way an expert in IHT)
    B) it will be subject to IHT - taper relief may be applicable
    C) assuming you've effectively given her a flat outright it will go to whoever benefits in her will, more complicated if she doesn't have a will so she needs one.

    Why buy a flat in her name, why not just give her the money as seems simpler to me?
    You describe your 47 yr old daughter as being dependent which is unusual. Does she have additional needs and would she be able to manage the flat independently?

    There may be a risk you get accused of deliberate deprivation of assets should you need social care in the future, but depends on your individual circumstances.
    • ivormonee
    • By ivormonee 4th Jan 18, 8:20 PM
    • 167 Posts
    • 102 Thanks
    • #3
    • 4th Jan 18, 8:20 PM
    • #3
    • 4th Jan 18, 8:20 PM
    If you give something to someone doesn't it count as a gift and, on any subsequent sale, would any appreciation in value not be subject to capital gains tax? I don't know if would be exempt under the primary residence rules (it probaly is, but I don't know).
    • Keep pedalling
    • By Keep pedalling 4th Jan 18, 9:03 PM
    • 5,085 Posts
    • 5,667 Thanks
    Keep pedalling
    • #4
    • 4th Jan 18, 9:03 PM
    • #4
    • 4th Jan 18, 9:03 PM
    More info required. What is your marital status? Would the second flat be your daughter!!!8217;s home, if not who is going to receive the rent, finally what other assets do you own?
    • xylophone
    • By xylophone 4th Jan 18, 10:24 PM
    • 25,555 Posts
    • 15,091 Thanks
    • #5
    • 4th Jan 18, 10:24 PM
    • #5
    • 4th Jan 18, 10:24 PM
    You are proposing selling your PPR? If so, there is no CGT on the sale.

    Is the idea that you would look for a block with two flats for sale- you would gift your daughter the money to buy one of them as her PPR and you would buy the other as your PPR?

    This would be an outright gift to your daughter and a PET subject to the usual rules.

    Your daughter would make a will ( or add a codicil to her existing will) in respect of the beneficiary of the flat in the event of her death.

    Are you the widow of your daughter's father?

    Take professional advice.
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