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Where Taxpayers and Advisers Meet

Transfer of Equity to Children

hungryfor knowledge
Posts:11
Joined:Tue Nov 14, 2017 5:00 pm
Transfer of Equity to Children

Postby hungryfor knowledge » Wed Apr 10, 2019 11:33 pm

I WANT TO TRANSFER 75 % OF MY OWN HOME TO MY CHILDREN
WHICH ONE OF THE FOLLOWING SHOULD I USE TO TRANSFER EQUITY

1.TENANCY IN COMMON
2.JOINT TENANCY

DO I NEED INFORM HMRC ABOUT THIS TRANSFER FOR MY CHILDREN GET EXEMTION FROM INHERITANCE TAX UPON MY DEATH?

AdamS93
Posts:268
Joined:Tue Sep 26, 2017 6:28 pm

Re: Transfer of Equity to Children

Postby AdamS93 » Thu Apr 11, 2019 11:49 am

You need professional advice from a solicitor and a tax adviser.

The transfer will not necessarily mean your property is excluded from your estate for inheritance tax purposes. There are all sorts of anti-avoidance rules which you may be caught by.

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

Re: Transfer of Equity to Children

Postby AGoodman » Fri Apr 12, 2019 3:38 pm

As said above, it is unlikely to save any inheritance tax.

It will also lumber your children with a potentially large and unnecessary CGT bill when they come to sell the property.

It is (very) rarely a good idea to transfer a home to children unless they are moving in and even then only a part.

AnthonyR
Posts:322
Joined:Wed Feb 08, 2017 2:33 pm

Re: Transfer of Equity to Children

Postby AnthonyR » Tue Apr 16, 2019 9:30 am

Plus don't assume that a property solicitor will give you any tax advice. In my experience (and I see your scenario once or twice a month) the solicitor doesn't give any tax advice and as the above posters mentioned and gifting a share of your property to your children usually puts you in a worse position in many regards.
Anthony Rogers LLB CTA TEP
Fusion Partners LLP
anthony@fusionpartners.co.uk

hungryfor knowledge
Posts:11
Joined:Tue Nov 14, 2017 5:00 pm

Re: Transfer of Equity to Children

Postby hungryfor knowledge » Thu Apr 18, 2019 12:51 pm

THANK YOU FOR YOUR REPLY,
HMRC WEBSITE SHOWS HOW OWN HOME CAN BE GIVEN TO CHILDREN IF THEY LIVE WITH ME. IT ALSO SHOWS HOW GIFTS INCLUDING GIVING AWAY MAIN HOME
WOULD BE TREATED UNDER 7 YEARS RULE.
IF I AM ALIVE UP TO SEVEN YEARS AFTER GIVING MY SHARE OF HOME, MY CHILDREN'S SHARE WILL BE EXCLUDED FROM INHERITANCE TAX.

I AM CONFUSED,
IF I TRANSFER EQUITY TO MY CHILDREN 80%,USING TENANCY IN COMMON METHOD, AND MENTION THIS EQUITY TRANSFER IN MY WILL.
WILL MY CHILDREN BE EXEMPT FROM INHERITANCE TAX IF I DIE AFTER SEVEN YEARS? OR EXEMPT PRO RATA IF I DIE BE SEVEN YEARS, UNDER HMRC 7 YEARS RULE.


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