Selling/transferring ownership of grandparents house
Discussion
Hi all,
Looking for some advice or suggestions on how best to deal with my grandparents house now that they are both in a care home long term.
When they bought the house 20+ years ago, it was under tenants in common between both of my grandparents, and their two chidren, my mum and uncle, so 25% to each of the 4 parties. My grandparents living there, and my mum and uncle elsewhere in their own houses.
So now they are both in a care home, although the money is not needed yet, as they have been in there for nearly a year and will not be returning home we were looking to sell the house.
My uncle came up with the idea of buying the house instead, as its a bungalow and hes now retired, not getting any younger etc, its a much better place for him to live. Everyone is happy with this, and as he already owns his own house outright, as well as 25% stake in my grandparents house, he can easily afford to buy it with proceeds from his house sale and savings.
Now the question is how do we best do this? What are the tax implications for my grandparents and mum?
Furthermore, what are the options/benefits with regard to my mum keeping her name on the house, as my uncle has no other next of kin, long term he will probably want to leave it to my mum anyway? It would just seem a bit odd for him to buy out everyone, with my mum then receiving funds from her 25%, and then for her still be a tenant in common anyway? Would it make more sense for my uncle to buy everyone out for now, and then deal with his estate later? Although I know for certain things there are periods of time that things have to have been in someones name as to not attract inheritance tax etc...?
Any help or input is appreciated! It seems like there are multiple ways to go about things, but of course we want to be as tax efficient as possible and ensure things are dealt properly. Thank you.
Looking for some advice or suggestions on how best to deal with my grandparents house now that they are both in a care home long term.
When they bought the house 20+ years ago, it was under tenants in common between both of my grandparents, and their two chidren, my mum and uncle, so 25% to each of the 4 parties. My grandparents living there, and my mum and uncle elsewhere in their own houses.
So now they are both in a care home, although the money is not needed yet, as they have been in there for nearly a year and will not be returning home we were looking to sell the house.
My uncle came up with the idea of buying the house instead, as its a bungalow and hes now retired, not getting any younger etc, its a much better place for him to live. Everyone is happy with this, and as he already owns his own house outright, as well as 25% stake in my grandparents house, he can easily afford to buy it with proceeds from his house sale and savings.
Now the question is how do we best do this? What are the tax implications for my grandparents and mum?
Furthermore, what are the options/benefits with regard to my mum keeping her name on the house, as my uncle has no other next of kin, long term he will probably want to leave it to my mum anyway? It would just seem a bit odd for him to buy out everyone, with my mum then receiving funds from her 25%, and then for her still be a tenant in common anyway? Would it make more sense for my uncle to buy everyone out for now, and then deal with his estate later? Although I know for certain things there are periods of time that things have to have been in someones name as to not attract inheritance tax etc...?
Any help or input is appreciated! It seems like there are multiple ways to go about things, but of course we want to be as tax efficient as possible and ensure things are dealt properly. Thank you.
Edited by Daaaveee on Tuesday 20th December 14:22
It was your grandparents' main residence - so when it is sold or transferred, they will not have to pay any Capital Gains Tax as the property is/was their main residence.
Your mother and uncle own a 1/4 share in the property each. The property is not (I asume) their main residence so the proceeds on disposal each of them receives - if the property is sold - will be subject to Capital Gains Tax.
The question is better on this forum as it is essentially a tax question.
Your mother and uncle own a 1/4 share in the property each. The property is not (I asume) their main residence so the proceeds on disposal each of them receives - if the property is sold - will be subject to Capital Gains Tax.
The question is better on this forum as it is essentially a tax question.
I think you are entering a hornets nest covered in honey, deprivation of assets?
https://helpandadvice.co.uk/avoiding-care-home-fee...
https://helpandadvice.co.uk/avoiding-care-home-fee...
Happy Jim said:
20+ years ago, this won’t be deprivation of assets.
It’s a CGT issue so structuring the sale becomes important/implications need to be worked through and understood (eg Uncle could just buy the 50% that Grandparents own = No CGT (but will get complex at the end of Uncles tenure).
Thanks Jim. Yes things could get tricky further down the line, so maybe a clean 100% buyout from my Uncle would be best. I think this is the way we are looking to go.It’s a CGT issue so structuring the sale becomes important/implications need to be worked through and understood (eg Uncle could just buy the 50% that Grandparents own = No CGT (but will get complex at the end of Uncles tenure).
Gassing Station | Finance | Top of Page | What's New | My Stuff