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Where Taxpayers and Advisers Meet

IHT question regarding a gift with reservation

metatron
Posts:12
Joined:Thu Jan 12, 2012 3:33 pm
IHT question regarding a gift with reservation

Postby metatron » Thu Dec 21, 2017 11:43 am

Dear all,

I care for my father who has recently signed his sole property over to me and we all live in this house together and have done for 15 years.

As he remains living at said house I understand it is a 'gift with reservation' and the 7 year IHT rule does not apply.

Now the house upon the transfer date was completely dilapidated and in need of major repairs and renovation and I'm going to be spending a small fortune doing the place up.

So would IHT be calculated on the value upon the date of his signing the property to me or the value upon his death?

kind regards

M

bibescu
Posts:25
Joined:Tue Sep 21, 2010 9:33 am

Re: IHT question regarding a gift with reservation

Postby bibescu » Thu Dec 21, 2017 2:10 pm

If the property gifted is subject to a reservation when the transferor dies, it has to be valued at the date of death.

maths
Posts:8507
Joined:Wed Aug 06, 2008 3:25 pm

Re: IHT question regarding a gift with reservation

Postby maths » Thu Dec 21, 2017 5:00 pm

What's the value of his property?

Is your mum alive? If not did she leave all her estate to your father?

metatron
Posts:12
Joined:Thu Jan 12, 2012 3:33 pm

Re: IHT question regarding a gift with reservation

Postby metatron » Thu Dec 21, 2017 7:58 pm

Hi, Mum died this year leaving me all her half of the house and dad has just signed his half to me as well.

metatron
Posts:12
Joined:Thu Jan 12, 2012 3:33 pm

Re: IHT question regarding a gift with reservation

Postby metatron » Thu Dec 21, 2017 8:00 pm

I might add the current value of the house is £400k and I plan to spend £150k and turn it into an £800k home.


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