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Where Taxpayers and Advisers Meet

Inheritance tax on property

Joined:Wed Aug 06, 2008 3:25 pm

Postby weety » Fri May 27, 2005 12:43 pm

Hi there

When my Dad finished paying off the mortgage on my parents home (about fifteen years) he had it transfered solely into my mothers name (previously it had been in joint names).....

My mother believes that when he dies (he has become ill and is very likely to predecease her) the house will not be sunject to Inheritance tax as it is in her name.

I believe that even though the house is in her name since my father has lived in it without paying any form of rent. It will be included as part of his estate for inheritance tax.

I would be grateful for any advice you can give me as, obviously, i think i am going to be in for some difficult conversations with my parents.

As a further difficulty my father does not have a will and refuses to make one (one of the old school) so i imagine i will have nightmareish paperwork to sort out.

Many Thanks


Joined:Wed Aug 06, 2008 3:13 pm

Postby cranleys » Fri May 27, 2005 1:18 pm


I would not anticipate this forming part of your fathers estate.

The legal ownership is held by your mother and it was not made with a gift with reservation.

Arnold Aaro
Joined:Wed Aug 06, 2008 3:11 pm

Postby Arnold Aaro » Sat May 28, 2005 2:42 pm

There is no IHT (Inheritance Tax) between husband and wife!

Joined:Wed Aug 06, 2008 3:15 pm

Postby Instinctive » Sun May 29, 2005 3:55 am

Why did your father transfer the whole house into your mother's name? Is your father making any use of his nil rate band of upto £275,000 by leaving other assets to third parties?

If the whole house belongs to your wife, will her assets exceed the nil rate band of £275,000 when she dies? If so, she should consider IHT planning. This could include some of your father's assets to be passed down to children rather than to your mother. Alternatively, your mother could consider deed of variation of your father's estate. If necessary, she should consider transferring the house back into joint names as tenants in common and for your father than to leave his half share to the children. But mother's needs must be protected at all times.


Joined:Wed Aug 06, 2008 3:25 pm

Postby j.c » Thu Jun 09, 2005 8:48 am

Hang on a minute !
If your father won't make a will, maybe he would be happy to die with no assets ie spend what he has immediately - down to the last penny and die happily intestate ?

You say he paid no rent for the roof over his head so you may be concerned about his estate's liability to pay IHT on his former "interest in possession" Excellent - he hen has negative assets equal to he IHT liability. I think tax libility dies with you if you have no assets. How can a personal tax liability when you are alive or dead become anyone elses problem ? Creating a negative value estate seems an ideal way to have the last laugh if you can do it !

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