Property transfer from parents to children

S

Sean A

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Hi all.

My parents own their family home (400k) and also another rental property (300k) which they receive a rental income from.

They have spoken about transfering their own home into our(children's) names but weren't sure about the rental property.

Problem being tax implications of the rental income going back to them if the transfer of the rental house went to us.

Also would there be any issue with my parents living in their family home once it was transferred to us.

Any help on this would be great.
 
The bigger issue here is Capital Gains Tax.

If your parents transfer the rental property to you on which there is a capital gain, they will pay CGT.

If they leave it to you after they die, there will be no CGT on it.

I presume that the reason they want to transfer their home to you is to avoid paying for their own nursing home fees?

Brendan
 
Thanks for the information.

Brendan. Yes. Piece on the radio recently stating that people with a second home would be harder hit if going down the fair deal scheme route.
 
Dont get me wrong I am all for people being tax efficient and paying as little tax as possible.

But....................Sorry if you can afford to pay for your own care you should.
Fair Deal Scheme is for assisting people who need assistance to pay for care in their later life

We should endeavor to leave it for the less able

As far as i am aware it is limited in its availability, i presume it is budget funded etc.
So someone availing of this when they can afford to pay for it could deny someone who really needs it the opportunity
 
This thread maybe ought to be merged with the other one.

Seems to me the best solution would be to transfer the home, leaveing a life interest to the parents. Then there is no CGT.

And of course there would be no CGT on the rental home if it had not increased in value. So that should be transferred during the next property crash.

Personally I’d want good legal advise before transferring assets to children as I’m loath to do that.

As the transfers are to avoid nursing home fees then it is absolutely crucial that legal advise in writing is acquired.

As it happens I had an aunt who had chronic alcoholism, so my grandfather left her the family home as a life interest only. When she developed dementia and needed to move into a home the stare paid for it. (Aunt had no assets, income or off spring). Not sure if that is the ‘fair deal scheme’ or not. But paperwork on the life interest had to be proven to the HSE.

OP would be well advised to ask what are the potential downsides of asset transfer.
 
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