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advice needed on transfer of property


Jellybeanz

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anyone have any advice/info on a relative transferring their house to me and my brother?


want to find out options without paying for solicitor's fees at this point, although i am well aware that i need to see a solicitor for the actual transfer (i have PoA) and to firm up advice received to check and consider all options.


many thanks.

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What sort of advice are you looking for? Tax? Legal?


Will the relative remain living there? Is their Estate likely to be near the IHT threshold?


Is it a gift or are you buying it? If it's a gift then you might have to apply to the Court of Protection despite having PoA, but I'm not a legal expert. I can give you some pointers on the tax issues with some more details.


There's also the Deprivation of Assets rules to think about in respect of care home fees in the future if that might be an issue.

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Do you have POA for the relative transferring the property? There are 2 types of POA - one which a person who has mental capacity wishes for some reason or other for an attorney to manage certain aspects of their finances etc. This is usually done where someone is abroad for some time, or the person is physically not able to attend banks/financial institutions etc. Or if they want someone to set up a loan agreement etc. Not used so much now - tending to be for short term basis.


If you have a POA set up and that person no longer has the mental capacity to give instructions and understand the implications of various transaction - the POA is invalid and you will need to apply to the Courts of Protection to seek a Deputyship Order. If you act under a POA to deal with financial or property affairs - you could be classed as acting fraudently as the person (donor) does not have the mental capacity to issue instruction and understand the implications of the transaction.


If you have Enduring or Lasting Power of Attorney, once the donor lacks capacity to understand and manage their financial affairs including property, the EPA/LPA needs to be registered with the COP so that the attorney can act in the best interests of the donor. Records of all actions and expenditure need to be kept as COP can request oversight of accounts.


I would be very wary if you have LPA/EPA for your relative and you have the property transferred to you and your brother's name as this is a conflict of interest and could be classed as a criminal act should anyone query the transfer. This also could be considered under Safeguarding Adults guidelines and Social Services could be asked to investigate - they would also probably involve the police.


A transfer of property to another person, if made in the 7 years prior to that person requiring a care home, could also be classed a Deprivation of Assets and the Local Authority are within their rights to count that property as still belonging to your relative.


I know gifts of money are exempt from tax is under ?3000 pa.


If your relative remains in the property after it transferred to yourselves - there are other implications. Should a legal judgement be made against you and the property is required to sold to pay back some debts then your relative could be homeless.

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