Inheritance tax question

A question about : Inheritance tax question

My mother owns a property worth about Ј300,000 If the property is transferred in to my name will i still be liable for inheritance tax after seven years if she is not living there?
My other option is to sell the property and bank the money.What would be the tax situation?

Best answers:

• As long as your mother does not live in the property after she has given it to you, it will be a potentially exempt transfer and no IHT will be payable as long as she survives for 7 years.
  However, some new legislation is due to come into force next April on 'pre owned assets'. Broadly speaking if someone gives you a gift and then at some point later on derives a benefit from the gift of anything which the gift has been used to buy then there is an annual income charge.
  This is all still in draft but for example, if you moved into the house and in a few years time your mother moved in with you then she would have an income tax charge each year based on the market rental value of the property. You will also be caught if you sell the property and use it to buy another one which your mother later moves into.
  Might be best to take advice on this before going any further. As I said this is still in draft but is due to come into force next April and is hideously complicated.