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Issue:
4879
/
Categories:
Comment & Analysis
, benefits in kind
, Estate planning
, potentially exempt transfer
, Capital Gains
, Inheritance Tax
Whose house is it anyway?
Key points
- Lifetime planning often relies on the gift of the family home being a potentially exempt transfer.
- Benefit of reservation may have to be considered if the parent continues to live in the house.
- An option is shared ownership although both parent and child must occupy the property.
- Aspects to consider if the parent provides cash for the child to buy a house for them to occupy together.
- Selling the family home to the children can avoid the gift with reservation of benefit rules.
Lifetime inheritance tax planning involving the family home can be complex and difficult. Views seem to polarise between doing nothing and doing something ‘spectacular’. As a result the middle ground that makes use of basic exemptions and reliefs can often be overlooked. The options in this neutral land are not one size fits all but they should not be disregarded.
This article aims...
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