Re: Mother's house is already in our names; questions about CGT in the event of a sale
Posted: January 31st, 2024, 4:56 pm
scrumpyjack wrote:genou wrote:For IHT you'd have to be "economic with the actualité" , since you can't amend the past. And then there would be the issue of missing income from the children's returns, so potentially 12 years of interest and penalties there. I don't think it would take HMRC long to grasp the situation.
Unfortunately the whole thing is a circular firing squad.
As the railwayman said when asked for directions, "I wouldn't start from here" .
For completeness, you either pay a full commercial rent or its a GROB - in principle 99% of a commercial rent ( should one be able to identify such a situation ) is still a GROB; so the peppercorn rent was always a waste of time.
Indeed the payment of a peppercorn rent might in itself trigger HMRC's computer system to raise a red flag!
Ah but would that red flag be raised at the time of the rent being paid and declared? If so then presumably the OP would already be alerted to the potential problem.
Or is it only raised if/when the taxman chooses to scrutinise the probate submission? In which case whether a problem actually arises will depend on whether this particular probate submission is chosen for further investigation. And how diligent the executor was in discovering the true nature of this flawed arrangement and therefore ignoring the passing of more than 7 years which would normally cause the gift to be ignored.