Buying property with parents

[AgainstTheOddsNo2]

We are just starting to look into the idea of both my parents and my husband and I selling our individual properties and buying a property with an annexe or self contained flat together. But we really need to look into tax and practicalities to make sure it's financially viable in the long run.

I thought we would need to speak to a financial advisor l but now I am thinking property lawyer?. Tbh don't know where to start.

Any advice on where to start looking for professional advice would really be appreciated.

I have no experience but I would start with a lawyer rather than financial adviser.

I think a good property and trusts lawyer would be the right person to advise on this. Issues include if either of the couples divorces and what % share you each own of the whole property or just the separate flat and wasn't there some new granny tax brought in for annexes which perhaps wasn't -ma be that was originally going to be an extra 3% stamp duty on the annex part which I think then wasn't brought in. May be the separate flat also comes with its own council tax.

You probably need a contract between the four of you too about what happens if one wants to sell and the others don't and on death - eg a sibling may get part of the parents' share when the parents die and need the cash out. Plus if over the ilmits - inheritance tax at 40% might apply.

None of this means it's a bad idea of course as all 4 of you might get a lovely large place much nicer than if you hadn't done this. and you might save inheritance tax when the parents die as I think there are special rules about properties in joint names and/or if they go into a care home.

Thanks for the advice. It's the care home stuff inheritance tax that worries me. I don't want to put my parents in the situation that if either of them need care then we would have to sell the house to pay for it essentially leaving us all homeless. Or a similar thing with inheritance tax. Parents have suggested house to be just in our names but I think a "gift" that large would have tax implications too

Yes, I think legal advice would be useful. I think that if you buy and make it clear what percentages are owned by which couple, e.g. You and DH own main house, parents own annexe, then if they go into care the LA can only claim against their part of the property.
DB did this, and when his MIL went into care, LA put a claim against a percentage of the property, that they will claim when the house is eventually sold, but they cannot force DB to sell as it is his home.

That is interesting to know! Thank you.

Do you just Google property lawyers or what. I have no clue on this. Our would think I would because I am not a stupid person. But tax. Inheritance and property (other than buying our own house) has never really crossed my radar before