Buying a house in my name for mum

[Budlet]

My mum is about to buy a flat for �70,000. Would it be possible for me and my brother to register the flat in our names, or will that have tax implications for us. I know the government has closed nearly every loophole on this issue, but if anyone out there has done this or can give me any information I would be so grateful. Thanks

[CheekyChops]

By 'register it in your names' I assume that you mean your names will be on the deeds? If so, the mortgage (if any) will also have to be in your name.

Why can't your mum just buy it in the normal manner?

[Budlet]

My mum isn't getting a mortgage. She is using her savings to buy it. My name will be on the deeds.

[CheekyChops]

Right, so she is trying to put the house in your name to avoid having to sell it in case she ever needs to go into a home?

I can't think of any other reason why it would be in your name. If I am wrong, can you explain why you want it in your name?

[Budlet]

Sorry CheekyChops I haven't made it very clear. Mum isn't in the best of health and I am concerned that if she has to go into a home that she will have to sell up to pay for her care. I was wondering if there was any way that I could effectively 'own the flat' by having my name on the deeds, so that if she does have to go into care it's not going to cost her life savings as she won't have to sell to pay for her care.

[buildersmate]

So in effect she is gifting you the �70k to buy the place, then living in it herself.
This has potential implications on inheritance tax because you cannot 'give' something away (as a Potentially Exempt Transfer that requires 7 yrs of time passing) and then hold onto it by living in it. However I know that wasn't the purpose behind your question.
Whether those that work out the 'rules' for having to sell one's assets to fund care home costs use the same logic as inheritance tax, I don't know.

[Ethel]

The government and authorities are very aware of this 'wasting assets' and 'disposing of assets' and could force you to pay for mum's care no matter how many years after the transaction.

Disposing of assets

If you have given away or transferred a capital asset (property, savings and so on) in order to reduce your charge for residential care, we can treat you as still having the asset and charge you accordingly. We look at each case individually, and there is no time limit on disposing of assets.


http://tinyurl.com/3oad5p

Quite right too. Why should I pay for your mother's care to make you richer?

[johnny37]

Ethel, I am aware of the rule about giving your assets away to try and avoid care home fees but has this ever been tested? If this did happen how would the authorities force the children to pay for care? They may have spent the money and have no assests themselves, or found some ingenious way of hiding it.

[Ethel]

They would put a charge on the house, if they have one.

Or a garnishee order. Force bankruptcy, perhaps.

[factor-fiction]

If your mum does have to go into a home just think how much more comfortable your mum's last months might be if she could use teh value of her home to buy teh best care rather than have to rely on where the council put her at the lowest cost to them

[pink-kittens]

Or even better, be looked after by her own family in her own home