Can you sell a house to a family member below market rate?

[raisinbran]

My mum would like to rent an apartment in a retirement village but she is only eligible if she sells her house.

Obviously the current market is not going to be practical but if she sold it to me offically, could this be a loop hole for her. I could then sell it back to her if required at the same price.However I couldn't afford to pay the going rate for the house

Whoops, sorry about spelling mistakes above.

I think you can sell your own house for whatever you want. You would need to be careful if she is planning to claim benefits for the new property, as selling her house for a reduced amount to a family member would be seen as a deliberate deprivation of capital and would affect her entitlement to benefits.

You can sell your house for whatever price you want to.

The legalities though always confuse me. Probably worth listening to StinkyFeet.

I will need to find out more on the rules of the retirement place. It is part private so I don't think benefits are an issue, also she has some savings so she wouldn't qualify for help anyway. Thanks for responding.

I think there could be tax implications as well if it was sold so below market value that avoided stamp duty in a particular band, also possibly inheritance tax issues too. Perhaps go to the CAB they should have basic info on these types of issue.

DH bought his grandfathers house at £10k less than the market value as he was set to inherit the money anyway.

AFAIK no one had to pay any extra because of this.

Message withdrawn

AFAIK, there would be no tax due when a person sells their main residence. Capital Gains Tax would be charged if she sold a second property that was not her main residence, and there's Death Duty if a property is sold in order to liquidate the estate of a deceased person.

Would just advise caution, you can sell anything you like to anyone you like, for any price. However if the house is sold at way below market value to a family member, and the vendor dies within 7 years of the sale, it may be classed as disposal of assets and fall under inheritance tax rules. This happened with my stepdads daughters house (I think), but I don't really know what happened as the stopped speaking to us the day he died.

I'm pretty sure there will be tax implications. You are allowed to "gift" up to a certain value (not very much, a few thousand pounds iirc) but after that anything that is given or sold at well below market value is subject to taxes. There are ways around this, I think, but you will need a specialist tax adviser - it may still be worth doing but possibly won't be as cheap as you believe, iyswim.

CGT and IHT rules(were she to die while you owned it and it was deemed a gift)would apply you could be liable. Equally if she were to claim benefits by effectively concealing assets to go below the threshold that could be deemed fraudulent.

No Solicitor will sell a property to family memebers if it is likely that stamp duty will avoided.