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Readers' Forum
Replies to Queries — 2
Doomed to fail?
Ten years ago, apparently without taking professional advice, mother and son attempted to avoid inheritance tax by gifting mother's house — then worth £110,000 — to her son.
Readers' Forum
Replies to Queries — 2
Doomed to fail?
Ten years ago, apparently without taking professional advice, mother and son attempted to avoid inheritance tax by gifting mother's house — then worth £110,000 — to her son.
Mother, now 90, is in good health and has continued to live in the house. There are no formal arrangements regarding her tenancy. The son is unmarried and has not lived in the house for many years. The house is now worth £250,000 and mother's savings are minimal, so inheritance tax is no longer a problem. But there is a potential capital gains tax liability of about £30,000 if the property were to be disposed of.
Other than emigrating or getting married, can this liability be reduced or eliminated?
The house would let for more than £5,000 per year, so is mother caught by the pre-owned assets legislation?
Readers' tax (or marriage) advice is welcomed.
(Query T16,513)
