Right to buy

[Boonie]

Not saying I wouldnt! I'm all for screwing the system mate, I was just pointing it out and trying to clarify my post.

Good luck to ya O

 

[Superhudd]

Just to point out, say the rent per week is ?ú100 (taking into account the rent paid 40years ago is a comparison to now)

over 40 years that means they have paid 208k in rent

I think they deserve 75k off.

Therefore they would have paid 273k for a two bedroom semi.

 

[The Moonlit Knight]

And you wouldn't do the same Boonie

I think most people would, because most people are capitalist in nature. It's when self proclaimed socialists pull brick like this that winds me up, because it's hypocrisy to the extreme.

 

[Kingdawson]

That's what screwing the system is. Exploiting a loophole for personal gain. Breaking the law is not screwing the system.

I'm not even going to pretend like i understand anything of what has been explained tbh. Let me ask something though..


I'm in the process of buying a house (well early stages anyway). How i've gone about doing it with the help of my mum is that my mum has remortgaged the current house (she owes nothing on the mortgage and the house is valued at ?ú270,000) and i'm paying the value of the new house in full (?ú180,000). I'll then take over the repayment of the mortgage on my mums house and rent out the new house. Is that considered screwing the system?

 

[WookieD]

Let me expand..

I have savings, around 45k.

I'll just give this to parents to make a down payment, and I will gurantee the rest via mortage through them with my house as guarentee for the remaining 20k, or I could probably wait two years save the extra, but that could be difficult with baby 6 months away, would take longer probably 4 years (Needs to be done before next election just in case). In 5 years they hand the ownership to me, then hope they live another few years to avoid inheritance tax.

What I can see happening loads of companies offering pensioners a better way of life. They pay the house with the 60% off upto 75k and you get to live in it to the day you die rent free.

Sorry, I haven't read the rest of this thread yet so someone may have asked. But...

Can you actually do this? Is the offer not exclusive to them and not siblings, children, grandchildren etc?

Now if this is the case and the house has to remain in their name, then "giving" them the ?ú45k for the down payment would be seen as a cash gift and taxable? Are you not going to sting yourself somewhere along the line and have the revenue come down on you?

 

[The Moonlit Knight]

I'm not even going to pretend like i understand anything of what has been explained tbh. Let me ask something though..


I'm in the process of buying a house (well early stages anyway). How i've gone about doing it with the help of my mum is that my mum has remortgaged the current house (she owes nothing on the mortgage and the house is valued at ?ú270,000) and i'm paying the value of the new house in full (?ú180,000). I'll then take over the repayment of the mortgage on my mums house and rent out the new house. Is that considered screwing the system?

No, because it's all privately owned transactions.

 

[P.D.]

If the place isn't worth over the inheritance tax threshold which it isn't then there is no need for them to transfer ownership to you unless they have other assets which would take their estate above the threshold.

 

[Superhudd]

If the place isn't worth over the inheritance tax threshold which it isn't then there is no need for them to transfer ownership to you unless they have other assets which would take their estate above the threshold.

I wasn't sure if that was right, actually cannot believe it, thats why I put the 7 years there just in case. As they say, I thought it too good to be true.

So as it would be there only asset as they are not cash rich then when they pass, I wouldn't have to pay tax on it. Thing is I will always think something is too good to be true and between 5 years of the right to buy and them passing the threshold would probably change. So to be safe, best to pass on surely.

 

[Superhudd]

Sorry, I haven't read the rest of this thread yet so someone may have asked. But...

Can you actually do this? Is the offer not exclusive to them and not siblings, children, grandchildren etc?

Now if this is the case and the house has to remain in their name, then "giving" them the ?ú45k for the down payment would be seen as a cash gift and taxable? Are you not going to sting yourself somewhere along the line and have the revenue come down on you?

Oh look my parents are under the mattress savers.

We just had a baby (in 6 months) and spent it on starting a family.

O

They would have no realistic way of knowing. I could say I blew it in vegas.

 

[WookieD]

Oh look my parents are under the mattress savers.

We just had a baby (in 6 months) and spent it on starting a family.

O

They would have no realistic way of knowing. I could say I blew it in vegas.

Hmm... I'd get the numbers right if I were you. The taxman turns up at the most inconvinient of times. How do you get the property back into your name?

You've bigger balls than me if you're going to do it on a wing and a prayer!

 

[P.D.]

I wasn't sure if that was right, actually cannot believe it, thats why I put the 7 years there just in case. As they say, I thought it too good to be true.

So as it would be there only asset as they are not cash rich then when they pass, I wouldn't have to pay tax on it. Thing is I will always think something is too good to be true and between 5 years of the right to buy and them passing the threshold would probably change. So to be safe, best to pass on surely.

Its set in stone, it may be frozen for a couple of years while the economy recovers but I doubt it will go down. Thats also ?ú325,000 each so if the estate is left jointly they can leave ?ú650,000 between them.

If the Tories win the next election outright then they want to raise it to ?ú1m. I hope they win as inheritance tax is probably the most unfair tax of them all.

 

[monkeybarry]

worse than taxing pasties?
pah

 

[DHSF]

Its set in stone, it may be frozen for a couple of years while the economy recovers but I doubt it will go down. Thats also ?ú325,000 each so if the estate is left jointly they can leave ?ú650,000 between them.

If the Tories win the next election outright then they want to raise it to ?ú1m. I hope they win as inheritance tax is probably the most unfair tax of them all.

I fudgein hate Inheritance Tax. I was studying taxation and advanced taxation a while ago and couldnt believe my fudgein eyes.

My parents spend all their lives paying tax and what they own and rightfully earnt IS TAXABLE WHEN THEY DIE? fudgein ****s.

 

[Bullet]

Well there we have it

Any cash handed down at least seven years before the donor dies is exempt from death duty, which is currently 40% of any sum over a tax-free band of ?ú325,000

Read more: http://www.thisismoney.co.uk/money/...ies-are-getting-around-IHT.html#ixzz1qzZDudxv

That article says that cash is exempt from capital gains tax - does this mean my dad could give me ?ú50k cash with no worries... I thought he would have to pay tax (or I would)
Anyone with tax knowledge care to explain please?

Any cash handed down at least seven years before the donor dies is exempt from death duty, which is currently 40% of any sum over a tax-free band of ?ú325,000.
If a donor dies within three years of making a cash gift, any sum over that nil rate band is charged at the full 40%. Every year after that the tax is reduced by 20%.
Experts say the phenomenon is more prevalent among the wealthy, who know they will most likely be financially capable of leaving an inheritance ÔÇô for example those with private pensions.
They are choosing to pass on cash to their family because it is exempt from capital gains tax.
Assets that could trigger a CGT liability by being passed on in the family include 'movable property' such as jewellery, antiques or works of art worth more than ?ú6,000, and second or holiday homes.

 

[DHSF]

You are allowed to give 3k on an annual basis without paying tax i.e. its exempt. Someone can pass off 6k or upto 6k but only if they havent used the previous years allowance.

There is no threat of inheritance tax on these amounts. Especially if the estate is below the threshold.

 

[Bullet]

You are allowed to give 3k on an annual basis without paying tax i.e. its exempt. Someone can pass off 6k or upto 6k but only if they havent used the previous years allowance.

There is no threat of inheritance tax on these amounts. Especially if the estate is below the threshold.

?ú3k is useless though - the equivalent of a tenner when you're talking about decent wedge to pay off mortgages etc

That article says cash is exempt from CGT... but ?ú3k is fuc,k all really per year

Pah

 

[WookieD]

worse than taxing pasties?
pah

Pasties are bland crap. Leave my fish and chis alone and you can tax them as much as you want

 

[DHSF]

?ú3k is useless though - the equivalent of a tenner when you're talking about decent wedge to pay off mortgages etc

That article says cash is exempt from CGT... but ?ú3k is fuc,k all really per year

Pah

Youre preaching to the converted mate. I dont understand why we pay IHT in the first fudgein place.

I think its always worth the 500 quid to get some proper tax advice.

 

[Sheikh Ma Nuggets]

Easiest way to move money around is to purchase a high value watch, then give it to someone along with the receipt. The recipient decides they don't like the watch, and brings it back for either exchange or refund. Another way is to dump/invest capital into a company, draw the money as a salary, have it declared insolvent and wind it up.

Plenty of ways to lose dosh out there

 

[Golfball]

Well there we have it

Any cash handed down at least seven years before the donor dies is exempt from death duty, which is currently 40% of any sum over a tax-free band of ?ú325,000

Read more: http://www.thisismoney.co.uk/money/...ies-are-getting-around-IHT.html#ixzz1qzZDudxv


SO basically I need to get this done asap.

They cannot sell the house until 5 years passed of doing right to buy

They need to live 7 years to avoid inheritance tax

12 years maybe!

Then and only then would it be a good investment for my kids to enjoy.

But up to 325 is tax free, im guessing if you are helping them with the house they might not have a huge amount in savings, plus if you are married it doubles to 650k doesnt it ?

Also inheritance might be split with any siblings etc