inheritance tax avoidance or transfer of deeds

[davinci1970]

Are your parents allowed to hand over their house to you in a way so that you do not pay the inheritance tax ? ( Ie put it in a trust so that when they die the property becomes yours but you avoide paying inheritance tax ?

Or can they transfer the ownership of the house into your name or sell it to you for say 10% less than the market price ?

[themas]

If they give it to you and go on living in it without paying a full market rent then it remains part of their estate for IHT. If they sell it to you for less than its full market value and go on living in it without paying market rent the same applies, but probably only on the difference between what you paid and the market value at the time you bought it.

Trusts are complex. It would be possible for them to make Wills inlcuding provision for setting up a Discretionary Trust on the first death. This might help reduce IHT. It depends on the circumstances and advice from a solicitor (preferably a member of Society of Trust and Estate Practitioners) is essential. However, the last Budget proposed changes in Trust law and the situation is confused at present.

[davinci1970]

thanks Themas