Transfer house to son

[pp111]

That's rubbish. I've had solicitors actively advise on the best way to avoid inheritance tax. Avoidance isn't illegal. Evasion is.

So I would suggest you completely ignore this post.

If you are talking about evading CGT or SDLT then you may have a point but avoiding IHT is perfectly legal.

It's not a question of either avoidance or evasion. There are rules for everything and if you are ignorant of these rules you can fall foul of the tax man. You can not just transfer money even between family members without implications. You certainly can not just transfer properties. It is best to seek the guidance of a solicitor so you don't end up in court.

 

[Psycho Sonny]

It's not a question of either avoidance or evasion. There are rules for everything and if you are ignorant of these rules you can fall foul of the tax man. You can not just transfer money even between family members without implications. You certainly can not just transfer properties. It is best to seek the guidance of a solicitor so you don't end up in court.

I was referring to "you also have to be very careful how you even word this to a solicitor, in that I found out a few years back that if anything is interpreted as "trying to avoid tax" when you are talking about properties then the solicitor is bound by law to report you to HMRC"

tax avoidance is legal and therefore the above is nonsense

 

[pp111]

I was referring to "you also have to be very careful how you even word this to a solicitor, in that I found out a few years back that if anything is interpreted as "trying to avoid tax" when you are talking about properties then the solicitor is bound by law to report you to HMRC"

tax avoidance is legal and therefore the above is nonsense

Oh I am so sorry I used the wrong word, lol. I am pretty sure you knew what I meant.

I once had an interesting conversation with a solicitor. I was swapping a house for another. Despite the fact that it was a swap, stamp duty has to be paid on both houses. To pay the duty the value of the houses had to be known. I worked out the values and told the solicitor. He accepted those values and afterward told me that had I even asked whether it is possible to underestimate the value of the house to "avoid" tax then I would have been reported to HMRC. This is mandatory, solicitors have no choice, they get heavily fined if they don't. The point here is that you may not even know it's evasion and still get reported. It's best to ask what is tax situation and not assume you know. The reporting does not of course mean you will get fined, but it does mean you will have HMRC breathing down your neck.

 

[mid_gen]

Just get a solicitor to sort it out.

You can't hide the value of the transaction. If the land registry shows a property going for conspicuously below market rate, you can bet your ass HMRC are going to come sniffing around.

You should have sorted this out in the first place. I'm in a similar situation, borrowed money from my parents to buy my house. The house is in my name, but there is a legal mortgage agreement between us and a charge on the deeds.

It cost a bit in solicitor fees to setup, but it's all above board tax wise, property is in my name. Once I've paid it off the charge gets removed, no transferring to deal with.

 

[android-fan]

Thanks for your advice everyone.

The house is not expensive, and even a notional 20% rise in valuation in the last five years will still mean no CGT will be payable (just about covered under the CGT allowance of 12k). We also had a extension done and other renovation work so can also offset that against any rise in value beyond just a market based increase.

Will take some legal advice but intend to do the land registry and stamp duty stuff myself.