Delete / Löschen
House ownership, families, IHT & paying rent
Allan
24.02.2011 - 21:55
24.02.2011 - 21:55
(Mum already has a house which she will probably sell at some point,0
gift us the cash and we hope she survives 7 years - but at least 3 - to0
quality as a PET).
My sister will be the legal owner of the new house (she2s technically0
putting up all the cash so that2s fair).
The purpose of this is to take the value of Mum2s house out of her esta=
te.
My understanding is that if Mum lives in the new house (owned by my0
sister) as long as Mum pays my sister a market rent, then this0
arrangement is fine (re Mum's estate). If Mum doesn2t pay rent to my0
sister, then the new house could be treated as part of Mum2s estate (an=
d0
subject to IHT as applicable).
(Since my sister already has her own house, she may have to pay CGT on0
the new home if later sold, depending on all sorts of things)
I2ve had conflicting advice:
An accountant has told me that Mum needs to pay rent to my sister to0
keep the house out of her estate
The solicitor dealing with the conveyancing says it is not necessary to0
pay rent
What is the correct situation?
"Chris R"
25.02.2011 - 10:55
25.02.2011 - 10:55
(Mum already has a house which she will probably sell at some point,
gift us the cash and we hope she survives 7 years - but at least 3 - to
quality as a PET).
My sister will be the legal owner of the new house (shes technically
putting up all the cash so thats fair).
The purpose of this is to take the value of Mums house out of her estate.
My understanding is that if Mum lives in the new house (owned by my
sister) as long as Mum pays my sister a market rent, then this
arrangement is fine (re Mum's estate). If Mum doesnt pay rent to my
sister, then the new house could be treated as part of Mums estate (and
subject to IHT as applicable).
(Since my sister already has her own house, she may have to pay CGT on
the new home if later sold, depending on all sorts of things)
Ive had conflicting advice:
An accountant has told me that Mum needs to pay rent to my sister to
keep the house out of her estate
The solicitor dealing with the conveyancing says it is not necessary to
pay rent
What is the correct situation?
---------------------------------------
It would be unwise to rely on Usenet advice on technical tax matters. Rely
on someone you can sue if they get it wrong.
Chris r
"Peter Crosland"
25.02.2011 - 11:10
25.02.2011 - 11:10
news:8snuocF8jqUemail@anonym...
My sister and I are going to buy my (89-year old) Mum a house
(Mum already has a house which she will probably sell at some point,
gift us the cash and we hope she survives 7 years - but at least 3 - to
quality as a PET).
My sister will be the legal owner of the new house (shes technically
putting up all the cash so thats fair).
The purpose of this is to take the value of Mums house out of her estate.
My understanding is that if Mum lives in the new house (owned by my
sister) as long as Mum pays my sister a market rent, then this
arrangement is fine (re Mum's estate). If Mum doesnt pay rent to my
sister, then the new house could be treated as part of Mums estate (and
subject to IHT as applicable).
(Since my sister already has her own house, she may have to pay CGT on
the new home if later sold, depending on all sorts of things)
Ive had conflicting advice:
An accountant has told me that Mum needs to pay rent to my sister to
keep the house out of her estate
The solicitor dealing with the conveyancing says it is not necessary to
pay rent
What is the correct situation?
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Nobody can afford to rely on advice from this, or any other NG, for critical
matters such as this. The parties concerned need to consult a professional
that has specific expertise in IHT planning.
Peter Crosland
"steve robinson"
25.02.2011 - 17:30
25.02.2011 - 17:30
Allan wrote:
My sister and I are going to buy my (89-year old) Mum a house
0
(Mum already has a house which she will probably sell at some
point, gift us the cash and we hope she survives 7 years - but at
least 3 - to quality as a PET).
0
My sister will be the legal owner of the new house (she2s
technically putting up all the cash so that2s fair).
0
The purpose of this is to take the value of Mum2s house out of her
estate.
0
My understanding is that if Mum lives in the new house (owned by my0
sister) as long as Mum pays my sister a market rent, then this0
arrangement is fine (re Mum's estate). If Mum doesn2t pay rent to
my sister, then the new house could be treated as part of Mum2s
estate (and subject to IHT as applicable).
0
(Since my sister already has her own house, she may have to pay CGT
on the new home if later sold, depending on all sorts of things)
0
I2ve had conflicting advice:
An accountant has told me that Mum needs to pay rent to my sister
to keep the house out of her estate
The solicitor dealing with the conveyancing says it is not
necessary to pay rent
0
What is the correct situation?
You need to speak to a taxation specialist , a normal run of the mill
solicitor may not be current in this rather specialist feld
My sister and I are going to buy my (89-year old) Mum a house
0
(Mum already has a house which she will probably sell at some
point, gift us the cash and we hope she survives 7 years - but at
least 3 - to quality as a PET).
0
My sister will be the legal owner of the new house (she2s
technically putting up all the cash so that2s fair).
0
The purpose of this is to take the value of Mum2s house out of her
estate.
0
My understanding is that if Mum lives in the new house (owned by my0
sister) as long as Mum pays my sister a market rent, then this0
arrangement is fine (re Mum's estate). If Mum doesn2t pay rent to
my sister, then the new house could be treated as part of Mum2s
estate (and subject to IHT as applicable).
0
(Since my sister already has her own house, she may have to pay CGT
on the new home if later sold, depending on all sorts of things)
0
I2ve had conflicting advice:
An accountant has told me that Mum needs to pay rent to my sister
to keep the house out of her estate
The solicitor dealing with the conveyancing says it is not
necessary to pay rent
0
What is the correct situation?
You need to speak to a taxation specialist , a normal run of the mill
solicitor may not be current in this rather specialist feld
Big Les Wade
26.02.2011 - 20:20
26.02.2011 - 20:20
This is my second attempt to post a reply.
Allan <email@anonym; posted
My sister and I are going to buy my (89-year old) Mum a house
(Mum already has a house which she will probably sell at some point,0
gift us the cash and we hope she survives 7 years - but at least 3 - to0
quality as a PET).
At 89, I wouldn't put it off long.
My sister will be the legal owner of the new house (she209s techni=
cally0
putting up all the cash so that209s fair).
The purpose of this is to take the value of Mum209s house out of h=
er estate.
My understanding is that if Mum lives in the new house (owned by my0
sister) as long as Mum pays my sister a market rent, then this0
arrangement is fine (re Mum's estate). If Mum doesn209t pay rent =
to my0
sister, then the new house could be treated as part of Mum209s est=
ate0
(and subject to IHT as applicable).
The new house could not be treated as part of your mum's estate because0
she never owned it [and did not contribute to the purchase].
However, when your mum sells her existing house and gives you the money,0
HMRC might look carefully at that gift. They might decide it is a sham0
gift, and regard it as still part of her estate under their Pre Owned0
Asset rules. Always remember HMRC's motto is "Lego ergo potui" - "We can0
do whatever we like".
Also the council might want to look at the gift when it comes time for0
your mum to go into care and be means-tested for it.
Is all this worth it? Are you sure the estate will really be worth0
enough for IHT to be payable? What happened to Dad?
(Since my sister already has her own house, she may have to pay CGT on0
the new home if later sold, depending on all sorts of things)
Correct.
I209ve had conflicting advice:
An accountant has told me that Mum needs to pay rent to my sister to0
keep the house out of her estate
That would have been correct if your mum gifted your sister her0
*existing* house and continued to live in it, but not for the new house.
The solicitor dealing with the conveyancing says it is not necessary to
pay rent
No, it isn't, if your mum lives in your sister's own house; essentially0
your mum becomes a family dependent of your sister.
--0
Les
Allan <email@anonym; posted
My sister and I are going to buy my (89-year old) Mum a house
(Mum already has a house which she will probably sell at some point,0
gift us the cash and we hope she survives 7 years - but at least 3 - to0
quality as a PET).
At 89, I wouldn't put it off long.
My sister will be the legal owner of the new house (she209s techni=
cally0
putting up all the cash so that209s fair).
The purpose of this is to take the value of Mum209s house out of h=
er estate.
My understanding is that if Mum lives in the new house (owned by my0
sister) as long as Mum pays my sister a market rent, then this0
arrangement is fine (re Mum's estate). If Mum doesn209t pay rent =
to my0
sister, then the new house could be treated as part of Mum209s est=
ate0
(and subject to IHT as applicable).
The new house could not be treated as part of your mum's estate because0
she never owned it [and did not contribute to the purchase].
However, when your mum sells her existing house and gives you the money,0
HMRC might look carefully at that gift. They might decide it is a sham0
gift, and regard it as still part of her estate under their Pre Owned0
Asset rules. Always remember HMRC's motto is "Lego ergo potui" - "We can0
do whatever we like".
Also the council might want to look at the gift when it comes time for0
your mum to go into care and be means-tested for it.
Is all this worth it? Are you sure the estate will really be worth0
enough for IHT to be payable? What happened to Dad?
(Since my sister already has her own house, she may have to pay CGT on0
the new home if later sold, depending on all sorts of things)
Correct.
I209ve had conflicting advice:
An accountant has told me that Mum needs to pay rent to my sister to0
keep the house out of her estate
That would have been correct if your mum gifted your sister her0
*existing* house and continued to live in it, but not for the new house.
The solicitor dealing with the conveyancing says it is not necessary to
pay rent
No, it isn't, if your mum lives in your sister's own house; essentially0
your mum becomes a family dependent of your sister.
--0
Les
RobertL
03.03.2011 - 14:00
03.03.2011 - 14:00
On Feb 26, 7:200pm, Big Les Wade <L...@nowhere.com> wrote:
This is my second attempt to post a reply.
Allan <inva...@invalid.invalid> posted
>My sister and I are going to buy my (89-year old) Mum a house
..>
>The purpose of this is to take the value of Mum2s house out of her est=
ate.
Your 89 mother wants all the upheaval of moving to a new home in order
to try to avoid paying inheritence tax? Your sister has enough
money to buy a new house for cash. If it were me I'd try and
persuade her to go on living in her own home and forget the whole
thing.
Robert
This is my second attempt to post a reply.
Allan <inva...@invalid.invalid> posted
>My sister and I are going to buy my (89-year old) Mum a house
..>
>The purpose of this is to take the value of Mum2s house out of her est=
ate.
Your 89 mother wants all the upheaval of moving to a new home in order
to try to avoid paying inheritence tax? Your sister has enough
money to buy a new house for cash. If it were me I'd try and
persuade her to go on living in her own home and forget the whole
thing.
Robert
"GB"
03.03.2011 - 15:35
03.03.2011 - 15:35
Assuming that dad has died and not used his nil rate band for IHT purposes,
there may be as much as double the normal nil-rate band.
Martin Bonner
04.03.2011 - 13:40
04.03.2011 - 13:40
On Mar 3, 1:000pm, RobertL <robertml...@yahoo.com> wrote:
On Feb 26, 7:200pm, Big Les Wade <L...@nowhere.com> wrote:
> This is my second attempt to post a reply.
> Allan <inva...@invalid.invalid> posted
> >My sister and I are going to buy my (89-year old) Mum a house
..>
> >The purpose of this is to take the value of Mum2s house out of her e=
state.
Your 89 mother wants all the upheaval of moving to a new home in order
to try to avoid paying 0inheritence tax? 0 Your sister has enough
money to buy a new house for cash. 0 0If it were me I'd try and
persuade her to go on living in her own home and forget the whole
thing.
Hear hear!
Also remember that you only pay inheritance tax on the amount above
the nil-Rate band. Either the net present value of the tax is
negligible, or it is worth paying for expert advice (rather than what
you hear on a newsgroup).
On Feb 26, 7:200pm, Big Les Wade <L...@nowhere.com> wrote:
> This is my second attempt to post a reply.
> Allan <inva...@invalid.invalid> posted
> >My sister and I are going to buy my (89-year old) Mum a house
..>
> >The purpose of this is to take the value of Mum2s house out of her e=
state.
Your 89 mother wants all the upheaval of moving to a new home in order
to try to avoid paying 0inheritence tax? 0 Your sister has enough
money to buy a new house for cash. 0 0If it were me I'd try and
persuade her to go on living in her own home and forget the whole
thing.
Hear hear!
Also remember that you only pay inheritance tax on the amount above
the nil-Rate band. Either the net present value of the tax is
negligible, or it is worth paying for expert advice (rather than what
you hear on a newsgroup).
Ähnliche Themen
