This site uses cookies. By continuing to browse the site you are agreeing to our use of cookies. To find out more about cookies on this website and how to delete cookies, see our Cookie Policy.
Analytics

Tools which collect anonymous data to enable us to see how visitors use our site and how it performs. We use this to improve our products, services and user experience.

Essential

Tools that enable essential services and functionality, including identity verification, service continuity and site security.

Where Taxpayers and Advisers Meet

adding son to deeds tenants in common then selling the house ... avoids 7 tear gifting rule?

richieboy85
Posts:1
Joined:Thu Oct 05, 2017 1:46 pm
adding son to deeds tenants in common then selling the house ... avoids 7 tear gifting rule?

Postby richieboy85 » Thu Oct 05, 2017 1:50 pm

Hi,

really need some advice please - my mother has a property she doesn't live in and is going to sell - she wants to give me approx £80K for a deposit on a house for me to buy.

If she does this I realise that i am liable for IHT if she dies within the next 7 years..

My question is can My mother put me on the deeds of her property as tenants in common and then sell the house so we can divide the profit from the sale and I receive the £80K that way?

What implications on tax does that give us both?

Thank you in advance,

Rich :D

Lee Young
Posts:2707
Joined:Wed Aug 06, 2008 3:26 pm
Contact:

Re: adding son to deeds tenants in common then selling the house ... avoids 7 tear gifting rule?

Postby Lee Young » Thu Oct 05, 2017 3:27 pm

No different. Its still a gift which if she does not survive seven years, will use up the first £80k of her nil rate band(s) and potentially IHT will be payable.

She may have up to £850k of exemption though depending on her personal circumstances. IHT may therefore not be relevant.
Lee Young
Solicitor, Chartered Tax Adviser and Trust and Estate Practitioner


Partner, Frettens LLP
lyoung@frettens.co.uk
01202 491701

AGoodman
Posts:1738
Joined:Fri May 16, 2014 3:47 pm

Re: adding son to deeds tenants in common then selling the house ... avoids 7 tear gifting rule?

Postby AGoodman » Mon Oct 09, 2017 10:47 am

Also: the recipient of a gift is only liable for IHT if the aggregate gifts to date exceed the nil rate band.

There is absolutely no risk of you being liable to tax on the gift unless she has already made at least £245k of gifts. This is the minimum. As Lee says, she could have a much larger nil rate figure available to her.

RMC
Posts:435
Joined:Wed Aug 06, 2008 3:35 pm

Re: adding son to deeds tenants in common then selling the house ... avoids 7 tear gifting rule?

Postby RMC » Mon Oct 09, 2017 1:12 pm

Transfer a share of a property is liable to Capital Gains Tax calculated as if the share was sold to you at its market value.
Why not see a qualified accountant or tax advisor??


Return to “Inheritance Tax, IHT, Trusts & Estates, Capital Taxes”

cron