Quizzes & Puzzles0 min ago
Deed of Gift
My parents want to give me their home, but remain living there until they die. Is it true that I simply have to complete the Land Registry form TR1 ? What other implications are there for tax etc ? Thank you,
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For inheritance tax, if they remain living there and do not pay you a market rent it is regarded as a "gift with reservation" and does not get excluded from their estates even if they survive 7 years. The full value at the date of death will be part of the estate for calculating IHT liability.
There may be Stamp Duty Land Tax implications of the transfer to you - in other words this tax may have to be paid on the market value of the house at the date it is transferred. It would be best for you to get solicitors advice before going ahead.
So far as you are concerned, if you don't live in the house and eventually sell it you would be liable for Capital Gains Tax.