kman Posted August 7, 2006 Share Posted August 7, 2006 I have an elderly friend who is terminally ill, he has a large property and no living relatives to leave it to. I have comtemplated asking him if he'd sell it to me a discounted rate whereby he could stay there until he passes away. A bit morbid I know but if he dies intestate then it just goes to Gordon B. How ould you tackle this scenario? Link to comment Share on other sites More sharing options...
IamSpartacus Posted August 7, 2006 Share Posted August 7, 2006 I have an elderly friend who is terminally ill, he has a large property and no living relatives to leave it to. I have comtemplated asking him if he'd sell it to me a discounted rate whereby he could stay there until he passes away. A bit morbid I know but if he dies intestate then it just goes to Gordon B. How ould you tackle this scenario? He could write a will and leave it to whoever he wants after IHT is paid. (Hope you're not planning to take advantage of an old man with a terminal illness... ) Link to comment Share on other sites More sharing options...
OzzMosiz Posted August 7, 2006 Share Posted August 7, 2006 He could write a will and leave it to whoever he wants after IHT is paid. (Hope you're not planning to take advantage of an old man with a terminal illness... ) It may be taking advantage, but there's no disadvantage to the 'old man'!! Link to comment Share on other sites More sharing options...
IamSpartacus Posted August 7, 2006 Share Posted August 7, 2006 It may be taking advantage, but there's no disadvantage to the 'old man'!! Perhaps he's deeply altruistic with a sense of social responsibility and would like to see the proceeds go to the Treasury... Link to comment Share on other sites More sharing options...
gilf Posted August 8, 2006 Share Posted August 8, 2006 I have an elderly friend who is terminally ill, he has a large property and no living relatives to leave it to. I have comtemplated asking him if he'd sell it to me a discounted rate whereby he could stay there until he passes away. A bit morbid I know but if he dies intestate then it just goes to Gordon B. How ould you tackle this scenario? In answer to the question, no you can't just sell it for any price you fancy. Actually thats not strictly true as you can but you will however still be liable for captial gains tax on the market value of the property. Lets say it was worth £200,000.... If it was sold at £150,000 thats unlikely to bother the tax man If it was sold at £20,000 they might come round for their cut. I'd suggest the idea to him, better to be open about it. Link to comment Share on other sites More sharing options...
Goat Posted August 8, 2006 Share Posted August 8, 2006 In answer to the question, no you can't just sell it for any price you fancy. Actually thats not strictly true as you can but you will however still be liable for captial gains tax on the market value of the property. Lets say it was worth £200,000.... If it was sold at £150,000 thats unlikely to bother the tax man If it was sold at £20,000 they might come round for their cut. I'd suggest the idea to him, better to be open about it. No, that's totally wrong. In the friends hands it is PPR and exempt for CGT purposes. In your hands it is a chargeable asset for CGT purposes, whatever price is paid by you (but if you go on to live there see earlier posts re PPR). Market value only comes into it where the transaction is between connected parties. Even if your friend does not have close relatives there must surely be someone somewhere in the distance, who would be entitled to the inheritance. Convincing the owner to sell at an undervalue is very iffy as it is effectively taking advantange of the vulnerable, this is especially true if you are an executor of the estate. Link to comment Share on other sites More sharing options...
gilf Posted August 10, 2006 Share Posted August 10, 2006 No, that's totally wrong. In the friends hands it is PPR and exempt for CGT purposes. In your hands it is a chargeable asset for CGT purposes, whatever price is paid by you (but if you go on to live there see earlier posts re PPR). Market value only comes into it where the transaction is between connected parties. Even if your friend does not have close relatives there must surely be someone somewhere in the distance, who would be entitled to the inheritance. Convincing the owner to sell at an undervalue is very iffy as it is effectively taking advantange of the vulnerable, this is especially true if you are an executor of the estate. No idea why I wrote capital gains tax as I meant stamp duty.... Sorry for the confusion. Link to comment Share on other sites More sharing options...
timbo Posted August 21, 2006 Share Posted August 21, 2006 If he gifts or sells it below market value within two years of his death you will still be liable for an element of the inhertiance tax, depending on the amount of the discount and how close to the two year mark you are. Therefore you'd be best off putting this to him sooner rather than later. Link to comment Share on other sites More sharing options...
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