Quarter of in laws house going in my name. Any implications I should consider?

[gingerbubs]

My in laws are looking to buy a house outright - cash buyers (other than a short term £5k loan to top up) having sold their previous house. They are keen to put portions of the house in others names, so I think a quarter to me, quarter each to 2 other family members, and quarter in my mother in law's name. It's a complicated situation with a genetic disease in the family affecting father in law and (in the future) my husband.
We currently have a mortgage on our house with 14 years left. It's possible we will want to move in around 5 years.
My mother in law has spoken with her solicitor who has said that as the value of the portion going to each of us is low (around £30k or less I think) then it won't have further implications for us financially. I know I should contact a solicitor myself but I doubt I'll get round to it because I am useless at life admin, so wondered if anyone here has any idea?
If it makes a difference they are in England and we are in Scotland.
Hope that all makes sense. I don't understand money things and property law very well so would be very grateful for thoughts from anyone who does!
Thank you

You definitely need independent financial advice, because the law in Scotland is different, English/Welsh lawyers cannot practice in Scotland and vice versa.

So a financial advisor rather than a solicitor? This is another reason I haven't got round to getting proper advice, I wasn't even sure who to ask!

Well, probably both. A solicitor first because of the different laws in England and Scotland, then they should be able to tell you if you need a financial advisor.

They need some tax advice. Do they realise that on the sale of the house you would have to pay CGT?

When they die the only tax payable is inheritance tax. The first £650k nil rate (rising to £1m by 2020 when additional nil rate is applied to the main residence).

May end up costing more in tax.

Thanks collaborate. I'm not worried about inheritance tax as estate will be way below the threshold.
With capital gains, am I right there would be tax owed on any profit made from a sale? Looking increasingly like I should pull my finger out and pay for some proper advice... Though still not too sure if solicitor or financial advisor would be best to approach?

Yes, you would pay CGT on any profit. That’s why it’s bonkers to do it.

There is CGT relief and CGT is less expenses paid out in the house which gives a net profit to be taxed . In a not very valuable house, the tax threshold won’t be reached. However you are still liable for maintenance and costs.

They should retain full ownership and transfer the house via their wills. Living in a house owned by others is not a good idea when you are elderly. The other owners could make you homeless. It’s a very silly thing to do.

A good solicitor should know the info. Tax advice from a financial advisor.

My MIL was looking at putting her house in her DC's names. We persuaded her not to after getting some legal advice.
If I'd split up with DH, I'd have a claim on the house and she could end up homeless.
If DH died, half the house would be mine and she could end up homeless.
If DH went bankrupt her house could be seized and she'd end up homeless.
It could be seen as intentional deprivation of assets by the local authority if she needed care in the future.
There were a couple of other negative points as well but we just refused to accept it. This was in England so I don't know how much is relevant to Scotland.

If the total assets are below inheritance tax then when they die providing there is a will dividing the house into portions then you wouldn’t pay anything.

If you owned a portion of the property then sold after they died you would pay CGT on your portion.

Not sure why they would do this .

Equally if you own other property (not sure if it applies to Scotland) wouldn’t your Council Tax go up on the house you are in.
I know things have changed recently but if you wanted to buy the stamp duty on your next house could also end up costing you more because you would in effect be buying a second home.

Someone with more information might be able to help you more.

This is an incredibly bad bad bad idea OP, from so many angles.
Thank god you're checking into this before it goes ahead.
Why on earth would your in laws think this was a good idea - if it was, everyone would be doing something similar, and our legal system/tax systems are set up to reduce murky, nontransparent financial setups just like this.

Aside from the cap gains tax and care/deprivation of assets issues which have been flagged here already (not to mention the issues around dealing with the estate from a probate/executor POV), there's also the extra tax implications due to your location if you move - the Land and Buildings Transaction Tax (Additional Dwelling Supplement) since you own another home that's not your main residence.

If you ever consider this (bonkers, amateurish) plan in any detail, you need your own solicitor, your own financial advisor, and they need to understand the implications of the England/Scotland location issue on top.

Why on earth you'd consider going forward with this mad plan is beyond me, but I suspect it's been raised by your in-laws because they don't really know what they're doing. Sorry to be blunt but it's obvious that's the case. Their solicitor also cannot provide you with the reassurance that would be needed - you aren't his/her client, and they aren't a financial planner - your in-laws are the client and so do not put any weight in any verbal reassurance being given second hand via your in-laws.

Thank you for the responses - much appreciated