Hi, my son has just been told he is being left a house in a will by his granny, who is now in a nursing home. She is giving him the keys and says he can have the house now as she will no longer be living in it. He is in college and would love to rent it, as he is in college in another city and needs to pay for his accommodation.
Rules have also changed regarding selling. Previously if you sold while in a nursing home under Fair Deal the net proceeds would be assessed indefinitely. Now if you sell your home while in care, the net proceeds also qualify for the 3 year cap. From the same link you provided:The rules with regard to renting property under the Fair Deal scheme changed in February, 2024, see here.
It is very important that the house is not gifted over now as anything disposed of falls under the 5 year rule under Fair Deal scheme.
I don’t know how he can rent a house he does not own.Hi, my son has just been told he is being left a house in a will by his granny, who is now in a nursing home. She is giving him the keys and says he can have the house now as she will no longer be living in it. He is in college and would love to rent it, as he is in college in another city and needs to pay for his accommodation.
any tips/advice please
Thk u v much for advice, do u have any details on caretaker role?So the fair deal will have to be paid when your relative passes away.
In the meantime, I'd suggest a caretaker arrangement, grandson pays bills & maintains property.
Don't see anything stopping him renting it out. This is what needs to be considered:Hi, my son has just been told he is being left a house in a will by his granny, who is now in a nursing home. She is giving him the keys and says he can have the house now as she will no longer be living in it. He is in college and would love to rent it, as he is in college in another city and needs to pay for his accommodation.
any tips/advice please
Unwise to sell and upset granny if will is in place gifting son the house. She may no longer be capable of doing a will.One option to strongly consider is selling the house now.
I do not know all the facts to be able to say if this is the right option for the granny and your son (and family) but it should be in your consideration. She can still achieve her aim of helping out your son. Having to look after an empty house/garden for anything more than a few weeks is a significant undertaking, as is becoming a landlord if the granny rents it out and you/your son effectively acts as the middleman.
Also obvious question, but hopefully she has a clear will in place - this should be updated if there is a major change in asset ownership like the house being sold.
Thats why I said I don't have all the facts and it should be an option for consideration.Unwise to sell and upset granny if will is in place gifting son the house. She may no longer be capable of doing a will.
He will have income tax implications on the house. That could be a major tax headache involving sale of house to pay the tax.
Granny could rent out the house. A lot of headaches there for the grandson who the house is willed to. He would have to administer the whole rental process. Being a Landlord dealing with tenants, the PRTB, tax returns for himself and granny is not for everyone, particularly a student attending college and living in another city.Don't see anything stopping him renting it out .......................
The rules with regard to renting property under the Fair Deal scheme changed in February, 2024,
It is very important that the house is not gifted over now as anything disposed of falls under the
Transferred assets
The assessment will look at assets that you have transferred (for example any land, money or property you have given to another person) since applying for State support or in the 5 years before the application.
Thank you for advice, totally agree re benefits and common sense of same, but legally for him to rent it (maybe via an agency ), what legal procedure would be best, in terms of minimising hassle to Granny and simplest/speediest in execution for all.Don't see anything stopping him renting it out. This is what needs to be considered:
- the rent would surely belong to granny
- income tax would have to be paid by her
- he could rent it out and pay house insurance and repairs out of it
- the income from rent is -happily- no longer assessed for Fair Deal.
The Good News:
- Granny can gift her grandson 3K annually without any tax implications for either party.
The reason the Fair Deal was changed was to encourage houses left vacant while people spent years in nursing homes. This case is perfect for that. And your son will learn to manage property.
In addition, Granny ought to pay him for managing the property. It is an actual task. So I would suggest 10% of rent. He'll have to declare that as income, but presumably he'll be earning little to no other money and so no issues on that score either.
Be careful about pre letting expenses. Come back to us on that if you decide on this route.
The benefits
- property is minded
- income received
- grandson learns how to manage as a landlord
- he gets paid for so doing
- house insurance is paid out of rental income
- house is maintained to a good standard out of rent
- somebody gets housed
- he should also complete the income tax returns for granny.
As previously advised, caretaker arrangement.minimising hassle to Granny and simplest/speediest in execution for all
He just rents it out himself and tells Granny he is taking care of everything. As long as she is happy with this of course.Thank you for advice, totally agree re benefits and common sense of same, but legally for him to rent it (maybe via an agency ), what legal procedure would be best, in terms of minimising hassle to Granny and simplest/speediest in execution for all.
Yes, thk u, but how does he do this? Is it protracted, obviously a Solicitor? Does it involve much trouble to his Granny?As previously advised, caretaker arrangement.