Inheritance Tax Query

[Rufus77]

We (my husband and I) are in the process of buying a new family home and we've been asked if we want it registered as Joint Tenants or Tenants in Common. The property we are buying is £630k which is only just below the Inheritance Tax threshold for a couple. If we choose Joint Tenants and one of us dies, would the other then be liable to pay Inheritance Tax? Would we be better choosing Tenants in Common and leaving our share in Trust to our two young children?

Any advice would be greatly appreciated.

[AGoodman]

Joint tenants likely to be simpler and tenants in common rarely carries any IHT advantage because:

(a) anything passing between you would be exempt from IHT (as spouses);
(b) the nil rate band is now transferable so the second to die would benefit from both nil rate bands (as well as both residential nil rate bands).

Also, in practice, having your children owning half of your house is not be a great situation to be in.

[Rufus77]

That's great. Thank you.