I cannot find other threads that answer this variation so hope you can help.
Parents own a valuable property in central London that is their main home.
Youngest parent is 80.
Are keen to consider gifting but still need a smaller property to live in as a replacement for their main home which is becoming impractical as they age.
There are 2 siblings and they want to treat both equally in the transaction.
One child (us) has significant disposable cash to potentially 'buy' the other out and one does not have the money but is open to being bought out.
Somehow the parents need other accomodation, and cannot afford this themselves despite the high value of their property (and want property to stay in family)
- How should we progress an equitable arrangement whilst recognising the risk that the property may end up within their estate for tax purposes (7 yr rule) given their age?
- Does giving the second sibling money in recompense constitute a taxable event for one / both?
- What taxable impact / risk if any is there if the sibling that is recipient of the gifted property then buys a different property for the aging parents to live in?
- How do we mitigate the arrangement for the fact that one sibling has to buy a new property for the parents as well as having to buy out the other sibling?
Also - The sibling with the cash is domiciled for tax purposes in USA, but will return to UK within a year or two to take up residence at the parents property as main home. Perhaps the transaction also creates an issue here.