Consider The Risks Before Giving Your Home Away
There may be many reasons for wanting to give your home away so firstly you should seek legal advice in order to understand what your options are.
Giving your home or any other assets away could result in the property being lost by the person to whom you have given it to if they became bankrupt or divorced. You will lose control over your property and therefore will no longer have any security to continue living in the property. The new owners of your property can ask you to pay market rent or leave. Equally they could re-mortgage the property which could then be repossessed if they default on the payments.
There are also Inheritance Tax implications on gifting assets away and that is that you must not only survive the gift by 7 years but you must not continue to benefit it from it, ie you cannot continue to live in the property without paying the full market rent. If you fail to comply with these requirements, then you will be taxed as if you still owned the property when you die.
Similarly, if you need to go into a care home and have given your property away, the local authority may not assist you with the cost of your care if you did not have enough money of your own to pay for your care.
These risks do not only apply to giving your property away but also to any of your assets you gift.
So before you give your home or any other assets away, think carefully about the risks of doing so and seek advice as to whether there is a better way to achieve your desired outcome.
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