tax on inheritance for receiver and giver

R

reenbee

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We are thinking of giving a house to our son as we are too old to manage it. I think he will not be liable for tax but would we be
 
Could you post more details please? What is the approximate value of the house? You as the donors will not be liable for tax in any event but the threshold for inheritance/gift for a child is approx. 450,000 so if it is less than that then neither of you will be liable for tax. But in my experience IT IS A REALLY BAD IDEA FOR PARENTS TO GIVE THEIR HOUSE TO A CHILD WHILE STILL ALIVE. Sorry but even the very best child can turn into a monster when the parent lives on beyond their expectations.

Please please take good independant advice and preferably look for an alternative. Please!
 
This is not our private residence, it is an extra property, does it make a difference
 
Yes, you could have liability to Capital Gains Tax if the value on disposal is greater than the original cost.
 
putsch said:
Could you post more details please? What is the approximate value of the house? You as the donors will not be liable for tax in any event but the threshold for inheritance/gift for a child is approx. 450,000 so if it is less than that then neither of you will be liable for tax. But in my experience IT IS A REALLY BAD IDEA FOR PARENTS TO GIVE THEIR HOUSE TO A CHILD WHILE STILL ALIVE. Sorry but even the very best child can turn into a monster when the parent lives on beyond their expectations.

Please please take good independant advice and preferably look for an alternative. Please!
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I've also seen the flip side of this where a parent has become incapitated, and no one can access their accounts or release property to raise funds when its most needed. Sometimes its useful to have all this sorted before its needed, or to prevent siblings from fighting over it later.

I don't think it makes any difference to the tax, when its done, though I'm not sure, does it? Many parents find it hard that so much of inheritance goes in tax, and perhaps would like to see their children benefit while the parents are alive. Sometimes the parents are downsizing and the children upsizing property too.
 
cgt payable by reference to an event which gives rise to a charge of cat is available for credit against such cat, if on or after 6/4/88 gift tax or inheritance tax is charge on a property and the same event constitures a disposal for cgt purposes the cgt in so far as it has been paid shall be deducted from the net gift tax or inheritance tax as a credit against the same provided that the amounts deducted shall be equal to the lesser of the net gift or inheritance tax or cgt under FA 85 Section 63, FA 88 section 66 and CATCA section 104

where cat is chargable more then once in respect of the same property on the same event the net tax payable on an earlier event will be allowable as a credit tax on the later event FA 85 section 62 and CATCA s105

hope this helps you
 
A leaves a property to B for the duration of B's life and then to C (the remainderman) absolutely.
Before B dies, C transfers his future interest to D (the transferee).
When B dies, C is treated as if he had become absolutely entitled to the property,
 
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