Can we we put our property in trust for our daughter and grandchildren and what are the implication of inheritance?

15th Jan 2019

CATEGORY: Wills, Probate & Trusts


2 answers
  • Thomas Simpson Solicitors Ltd

    You can transfer your house into trust but there are very significant tax implications for you and your descendants.  You should seek legal advice from a well qualified solicitor before taking any action at all as the consequences of getting a transfer of this type wrong can be severe.

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    Thomas Simpson Solicitors Ltd

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  • Bridge Law Solicitors Limited

    It is unclear from the question whether your intention is to put the property in trust now in your lifetime or to do so when you die in your Wills.  If you do so now and you still live in the property you would need to have a tenancy agreement and pay market rent otherwise you would still have a beneficial interest, which would affect your intention of gifting the property.  If you gift a property and do not retain an interest then it would be classed as a lifetime gift and provided you survived a minimum of 7 years no inheritance tax would be payable.  Within 7 years it would be payable on a sliding scale as a potentially exempt transfer.  This may have other tax implications for family members such as income tax on any rent paid and CGT when sold, it could also affact any benefit claims they may have.  There can be family disagreements relating to such arrangements so it is always best to discuss with a solicitor/financial advisor in detail before deciding.

    You can put a property in trust in a Will, this is usually now done as a means of splitting the parent's estate in half to protect against possible care home costs but is not usually done now to save inheritance tax.

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    Bridge Law Solicitors Limited

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