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TaxRobin
TaxRobin, Tax Consultant
Category: Tax
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Experience:  International tax
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Mum is selling the family home to my sister,I will be receiving

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Mum is selling the family home to my sister,I will be receiving half of the sale price and mum will still live there after alterations will I have to pay any tax on my share
Submitted: 3 years ago.
Category: Tax
Expert:  TaxRobin replied 3 years ago.
Hello,
Your mother can gift you the money and as long as the 7 years expire prior to her passing, the amount will not be under taxation.
Any gifts that someone makes to individuals will be exempt from Inheritance Tax as long as they live for 7 years after making the gift. These sorts of gifts are known as 'Potentially Exempt Transfers'.
If the giver dies within 7 years and the total value of gifts they made is less than the Inheritance Tax threshold, then the value of the gifts is added to their estate and any tax due is paid out of the estate.
If they die between 3 and 7 years after making a gift, and the total value of gifts that they made is over the threshold, any Inheritance Tax due on the gift is reduced on a sliding scale. This is known as 'Taper Relief'.
Inheritance Tax is only owed if the value of the deceased's estate - or a transfer in connection with a trust - exceeds the Inheritance Tax threshold (£325,000 in 2014 to 15 tax year).
You would not owe tax on the gift made to you from your mother. A beneficiary or donee only has to pay Inheritance Tax if they receive a gift from someone who dies within 7 years of making the gift and the estate can not pay.
Customer: replied 3 years ago.
I expect the amount to be less than100k so to clarify she can gift me this and I don't owe anything but if she were to die within 7years a fee would become payable
Expert:  TaxRobin replied 3 years ago.
Hello again,
You are correct, you will not pay tax on the gift. If she were to pass before 7 years and her estate is valued at more than the Inheritance Tax threshold (£325,000 in 2014 to 15 tax year), the estate or you (if the etsate could not would pay) would owe some tax.
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