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Transfer of home to children

Transfer of home to children

My client is 73 years of age very fit and still running a small business. He wants to transfer his home into his childrens names and still live in the house. His assets including the home are about £250k so no inheritance implications.

I have advised him that capital gains will be payable by children if and when they sell the house based on market value of house at date of transfer.

Am I correct in saying that as it is a nil consideration there will not be any SDLT to pay.

Thanks for any comments regarding pitfalls and implications of this situation.

I assume the man in the pub has told him to do it to avoid care home fees but I have not gone into this aspect.

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04th Mar 2016 09:44

Councils have the right to ignore assets' transfers done to avoid care home fees - so man down the pub strikes again

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04th Mar 2016 10:19

Trust

Hi

My wife's parents did this through some sort of complicated trust to transfer it to children so that may be an option.

I think there's a time limit after which councils can't grab the money to pay for care home fees but I just left it to solicitors to sort out.

Regards

Chris

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By JimFerd
04th Mar 2016 10:46

There's no time limit as far as I'm aware.

Each council will be different, but I think they'll automatically look back at the persons finances in the six months prior to them going into the home.

If they think something has been done in the past to avoid care home fees, then there's no time limit to which they can look back.

However if the guy in question is 'fit and well' at the time of the transfer - then it could be difficult for the council to prove it was done with the intention of avoiding care home fees.

I'd recommend speaking to a solicitor though, as a straight transfer may be easier for the council to prove was motivated by care home fee avoidance, rather than say a trust.

An yes - no SDLT as no consideration.

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04th Mar 2016 11:46

This might help.....

https://www.gov.uk/government/uploads/system/uploads/attachment_data/fil...

I haven't read it, but it seems to go into the nitty gritty.

 

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