Why make an outright gift of your family home?
There are many reasons for considering making an outright gift of the family home such as:
- General affection – your recognition of the recipient’s love and affection
- Moral obligations - you feel that it is appropriate that a family member receives a gift of value from you
- Financial obligations – your recognition of the recipient’s financial contribution
- Family harmony – avoiding family issues or disputes
- Passing of the burden of owning property – to free you of the financial burden and responsibility that comes with owning a home
But you should consider such a decision with caution as your home may be your most valuable asset.
Some of the reasons for being cautious about making an outright gift of the family home
- Financial difficulties of the recipient - if the recipient has financial problems or becomes bankrupt, your home may be lost to creditors
- Divorce of the recipient – if the recipient gets divorced, your home will become part of his/her assets in determining a divorce settlement
- False hopes about tax – Beware you may not save inheritance tax or other taxes
- Recipient in receipt of means-tested benefits – such benefits may be stopped or reduced
- Long-term care provision – it may not reduce the cost of long-term care fees
- Premature death of the recipient – if a child dies, the family home will pass by their Will or the ‘rules of intestacy’ which could be to a spouse who may then remarry.
Still wish to gift your family home? Please contact Amy Makaruk or Trudie Nicholas on 01432 352121 who will be able to assist