As a homeowner you are free to transfer your property to your children at any point, however doing so is far from straightforward, especially if you wish to continue living in the property.
If you give your property to your children as a gift, you will need to survive for 7 years from the date of the gift for the value of the property not to form part of your estate. However, should you pass away within those seven years then the property would fall back into your estate for inheritance tax purposes.
Should you continue to live in the property after gifting this to your children, then the house would remain part of your estate on your death, even if you live beyond seven years. In order to avoid this then you would have to pay market rent to your children for living in their property.
Other important issues to consider are that (1) you will no longer be the legal owner of the property and you would no longer have any say on what happens with the property (2) your children may become bankrupt or (3) go through divorce and as the property would be held in their name, it would be classed as their asset and would be taken into account by creditors or in a divorce settlement.
If you find yourself facing complexities and uncertainties regarding property transfers and estate planning, it’s crucial to seek expert guidance. Gaynor Cooke, our Partner and Head of the Wills and Probate Department is here to provide you with the necessary support and advice to manage these complex matters. For personalized assistance and peace of mind, you can contact Gaynor Cooke at 01202 692448 to ensure your property and estate plans align with your wishes and goals.