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Hi everyone!! My Mum owns her house outright, worth £450,000, and is unwell (heart failure) and needs to move in with me to be looked after, and will be gifting the proceeds of the sale of her house towards a property we will buy together. My Mum isn't likely to live another 7 years and I'd like to avoid paying inheritance tax. Is there a potential way? Perhaps the below?
Mum is selling her house for £450,000 and moving in to a house with me which we are purchasing together, worth £675,000. Mum will put in £450,000 from the sale for her house and I will get a mortgage for the additional £225,000. The new house will be in my name. Since Mum is contributing £450,000 presumably it will be seen as a gift and the amount above £325,000 will be liable for inheritance tax. Could a way around it be that Mum gifts the current property to the me now (since its worth under £500,000 it shouldn't be liable for inheritance tax) and then I'll sell it right away, once I own it, and purchase the new house. Is this possible? Would it mean that 0 inheritance tax would be owed? Is there a minimum amount of time I would have to own the house before selling or could I sell immediately? Is there any easier way? Thanks so much!!
Mum is selling her house for £450,000 and moving in to a house with me which we are purchasing together, worth £675,000. Mum will put in £450,000 from the sale for her house and I will get a mortgage for the additional £225,000. The new house will be in my name. Since Mum is contributing £450,000 presumably it will be seen as a gift and the amount above £325,000 will be liable for inheritance tax. Could a way around it be that Mum gifts the current property to the me now (since its worth under £500,000 it shouldn't be liable for inheritance tax) and then I'll sell it right away, once I own it, and purchase the new house. Is this possible? Would it mean that 0 inheritance tax would be owed? Is there a minimum amount of time I would have to own the house before selling or could I sell immediately? Is there any easier way? Thanks so much!!
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