Lending money to buy a house

[sicknessmedi]

My mum has been served notice to move out of her home in London. I want her to move up north with me but she has limited savings and retired so no income.

Could I gift her the money to buy a home and she live there? Will the government make her sell her home if she goes into a care home?

I can’t think of any savings to be had by using a partnership here..? (Or in general tbh!?).

Why don't you stop looking for loopholes and just pay some tax like a decent, responsible person?

If buying your mum a house doesn't work, can't she move near you and rent with whatever income she uses at the moment and/or benefits? Rent is likely to be much cheaper up North.

I think OP has paid tax on this money but wants to avoid paying extra tax on using the money to provide housing for her mother, who would otherwise perhaps be using housing or other benefits to house herself?

Hahaha

Why the fuck should I pay tax when I'm housing a citizen

You're not coming across well on this thread!

The extra stamp duty on a second home isn't (in my opinion) a deal breaker here, because property is a long-term investment, and will achieve capital growth.

I don't like paying tax either, but as long as you work out the most tax-efficient way to go about it, then you should find a suitable solution. You could always try asking ChatGTP whilst you wait to speak to a professional tomorrow about it.

You can let her live there rent free. Can she put some of her savings towards the stamp duty?

Not coming across well is an understatement. Rude, and obnoxious is more fitting.
Posters have taken time to give you good advice and you have been nothing but sarcastic.

Won't achieve growth if has to be sold.

This seems like the best approach. I don’t know why so many people are jumping to accuse the OP of tax dodging. She’s has a sum of money on which, presumably, tax has been paid that could provide a home for her mother. She doesn’t, as far as I can see, want rent to be paid. But rightly is mindful of stamp duty, future capital gains tax liability and potential care costs and protecting her capital.

So lending her mother money to buy a house in her mother’s name neatly avoids, quite legitimately, the second home uplift on stamp duty. Securing the loan with a charge protects her money from being called on for care costs - again, no one else is expected to fund care for their parents, though of course they can, and the option is still there for the OP.

Assuming few other assets then I expect the mothers estate will fall within the (current) IHT threshold, including the additional allowance for house proceeds. And if the OP is concerned about IHT then subjecting the loan to interest and rolling it up with the capital owed probably means that the debt will grow at least as quickly as the capital value of the house leaving the IHT band for other stuff. Although I think tax needs to be paid on interest accrued not paid, though I might be wrong on that.

"Hahahah
Typical mums net bully.
So do you feel better"

Oh the irony, you have been nothing but rude and disrespectful, carry on as you are the gift that keeps on giving. You can dish it out but you cannot take it. The person I pity is your Mother, think about why you are so unpleasant.

OP would it perhaps be viable to build an extension on your own home for your Mum to live in, or maybe a 'Granny Annexe' at the bottom of the garden, rather than a completely separate property?

This was where you jumped the shark.

If you were going to gift her the money anyway, then you weren’t expecting rent etc, in which case I’d buy in your name, and let her live rent free (so no tax on the rent). Yes you’d pay the 5% additional stamp duty but you wouldn’t risk losing all your investment if the house was in her name and sold for care fees. I’d rather lose an extra few thousand than the whole lot.

I'd just buy the house in your own name and let your mum live there rent free. There'll be no tax on zero rent, and as your own property then it can't disappear on care home fees unless you choose to sell it and spend it on that.

And at least your mum will be securely housed.

Wow glad I took time to give you advice. If you want loopholes then pay a tax lawyer

To achieve your objectives give her the money to buy the house and let her register it in her name, as sole owner.
When this is done register a legal charge on it to the value of your investment. Best to get a solicitor to do this

I’m at a loss as to why people have turned this back on the OP as if she were some kind of money-laundering crook.

It’s a phenomenally kind thing to do to buy an elderly parent a house to live in. This comes at considerable personal cost to the OP(said funds could have been for their own retirement or their children’s house deposits).

Further, the OP is saving the taxpayer the cost of either providing social housing or housing benefit.

I’m kind of appalled that an elderly person hasn’t planned for the future, such that the adult has had to swoop in to save the day, but there you go. That’s how it seems to be. I couldn’t do that for my mother. I’ve still got hefty mortgage and also need to prioritise supporting my adult children.

OP please don’t write to the Telegraph with your lovely story lest a load of elderly mothers out there flap the article in our faces, eh?

I’m quite interested in this home in london. Why has she been served notice? If she has limited means then due to her age she would be classed as vulnerable and therefore given priority for social housing.

just pay the stamp duty - it sounds like you can well afford it

Well many cause the op is being incredibly rude to people who have tried to help

The answer to your question is yes, the state could make her sell the house to pay for care fees.

You've had a good suggested alternative here which is to put the house in your name which will cost you a few quid more but save on care fees and I don't understand why your dismissing that excellent suggestion. People have taken time out of their day to share their ideas with you.

Loan her the money. Get a solicitor to draw up a document saying when the property is sold it goes back to you.

Be wary of retirement flats - they can have awful service charges.