Home dilemma

[RT/M]

I am not sure how to go about this. Having recently paid off my mortgage i am thinking of either putting my house in my only sons name or in some sort of trust for him, i am not to sure if there are any other options available. This is for two main reasons really. 1 to avoid inheritance tax and 2 being single, if i was to meet someone in the future long term and they moved in and after a while it went t**s up, i would not want anyone else to get there hands on the house which i want my son to have. Has anyone been in a similar situation and done anything about it?

[fat80b]

RT/M said:

I am not sure how to go about this. Having recently paid off my mortgage i am thinking of either putting my house in my only sons name or in some sort of trust for him, i am not to sure if there are any other options available. This is for two main reasons really. 1 to avoid inheritance tax and 2 being single, if i was to meet someone in the future long term and they moved in and after a while it went t**s up, i would not want anyone else to get there hands on the house which i want my son to have. Has anyone been in a similar situation and done anything about it?

Also worth considering what happens if you do manage to do this and then your son meets someone / gets married / sprogged up / divorced / falls out with you / goes bankrupt / decides to mortgage it / dies etc.

For these reasons, what seems like a simple idea is actually mighty complicated. Tread carefully.

I think I'd be taking legal advice.

[Sarnie]

fat80b said:

Also worth considering what happens if you do manage to do this and then your son meets someone / gets married / sprogged up / divorced / falls out with you / goes bankrupt / decides to mortgage it / dies etc.

For these reasons, what seems like a simple idea is actually mighty complicated. Tread carefully.

I think I'd be taking legal advice.

^^This...…..

[dogz]

I would get paid for legal advise on this

Biggest risk of putting it in your sons name is not from him (its sounds like you trust him implicitly) but if he gets married and subsequently divorced. His wife would have a claim on it

Also putting your house in trust does not stop inheritance tax being payable if its due - If you are over the threshold when you die then you will pay what's due

I also believe if you did meet someone and they moved in, they would not have an automatic right to claim a share of your house if you split. This would be different if you married them though

I am not an expert in these issue so I'd get a perspective from a decent solicitor

[RT/M]

Thanks guys, looks like i may have to take legal advice on this. I am just trying to find out the best thing to do so my son ends up with the house and no one else as well as with no inheritance tax having to be paid if the worse was to happen to me. Also i have paid more than my fair share of income tax over the years so i would not want him to have to sell the house to pay for a nursing home if i was ever to end up in one.

[ellroy]

Be wary of trusts around property, purely from a tax perspective.

Trusts pay tax at the highest rate for income, 45%, and typically only have half the normal CGT nil rate, at best.

As trustees should aim to get a return on the trust assets, to the benefit of beneficiaries, you could have to pay rent to the trust, market rate, of which nearly half would go off to HMRC!

Tread carefully and take advice.