Changing House to Another Name

PeteK*

Hi,

Is there anyone here who can give me an idea of what it will cost for my father to put a house he owns into my name?
There is no mortgage on the property it that makes a difference.

He reckons it will be around €4,000. I've searched the interwebs and can't get any information that makes sense to me.

I want it to be pretty legit and pay whatever taxes are expected, otherwise I may be screwed in the future.
There is a tenant in there but I don't ever plan to live there and I'm not likely to sell it, either.

Ipro

As far as I know the tax is calculated on the value of the house. The transfare of deeds will prossibly be done on a percentage basis also.
OP , If you state the value of the house or value of similar properties in the area then other posters will be able to give you a rough figure.

PeteK*

I think around €150k MAX.. but likely even less now.
Unfortunately less than half for the boom times! :P

scwazrh

legal fees should be no more than 2k if everything is straight forward.Depending on how much he has given you before you may be within gift tax limits.Im not sure about stamp duty .

The_Conductor

Too many unknown factors here.
You need to sit down with a tax accountant for an hour- and work through this.
The tax implications- could quite conceivably, be a lot more onerous than the actual cost of transferring the property by deed into your name.

Depending on your current income- it could put you over the (very low) threshold into the higher tax band. The lack of a mortgage is not necessarily a good thing- as traditionally it has been the large expense against which rental income can be deducted before determination of taxable income (there are other expenses too- but normally none as large as the mortgage interest- which is now at a 75% level).

Lots of things to consider in all honesty.

Pawwed Rig

Yes do what The Conductor says. There are tax planning opportunities here that may enable to get you the house without it being considered for Capital Taxes but they would need to be planned carefully ensuring you meet all the criteria.
Also as stated the mortgage interest. For example in certain situations a person could gain by remortgaging a rental property and paying down their own mortgage. Would depend on the interest rates on own mortgage etc etc.
It also depends on your Father's income compared to yours as to whether it is even a good idea or not.
The conveyance itself would be somewhere around 2-3K. Call a solicitor for a quote. They will give it to you over the phone.

Geuze

PeteK* wrote: »

Hi,

Is there anyone here who can give me an idea of what it will cost for my father to put a house he owns into my name?
There is no mortgage on the property it that makes a difference.

He reckons it will be around €4,000. I've searched the interwebs and can't get any information that makes sense to me.

I want it to be pretty legit and pay whatever taxes are expected, otherwise I may be screwed in the future.
There is a tenant in there but I don't ever plan to live there and I'm not likely to sell it, either.

Two issues.

One, the legal costs of transferring ownership.

Second, the possible taxes payable as the asset is transferring.

Possibly CGT payable by the diposer.

Possible CAT payable by the recipient.

PeteK*

Thanks for the replies and the information given.

Would it be OK for me to just use a solicitor or would I really benefit from visiting a tax accountant, too?

What's CAT? I'm not up on any of this at all, to be honest.

Pawwed Rig

PeteK* wrote: »

Thanks for the replies and the information given.

Would it be OK for me to just use a solicitor or would I really benefit from visiting a tax accountant, too?

What's CAT? I'm not up on any of this at all, to be honest.

A solicitor may know the answers to your queries but he may not. Depends on how up to date he is. The tax code changes regularly. You may end up paying him for his time to read up on issues whereas a tax person would have the answers quickly.
CAT is capital acquisitions tax.

Henry Ford III

CAT threshold from Father - Son is €225,000.

PeteK*

Henry Ford III wrote: »

CAT threshold from Father - Son is €225,000.

That's good news for me?
If so, what does it mean?
Sorry for being so thick!

The_Conductor

PeteK* wrote: »

That's good news for me?
If so, what does it mean?
Sorry for being so thick!

If the property is valued at over 225k- you pay the full whack of CAT on that portion in excess of the limit. It also bankrupts your tax free inheritance from your parents. When times were good- the limit was 450k- but now, to try rustle up schekels for the exchequer- they've halved it.

Pawwed Rig

The_Conductor wrote: »

If the property is valued at over 225k- you pay the full whack of CAT on that portion in excess of the limit. It also bankrupts your tax free inheritance from your parents. When times were good- the limit was 450k- but now, to try rustle up schekels for the exchequer- they've halved it.

It doesn't mean there will be no tax in the transaction though which is why the OP needs to get advice. It is still not clear to me what the point of the transfer is

The_Conductor

Pawwed Rig wrote: »

It doesn't mean there will be no tax in the transaction though which is why the OP needs to get advice. It is still not clear to me what the point of the transfer is

Personally- I think it would make sense to associate debt with the property- e.g. for the parent to mortgage it- lowering its value- and bringing it in under the threshold.

From the perspective of the parent- the media are widely reporting that prices will increase nationwide by upwards of 20% in the coming year (which sounds like bullsh*t of the highest order to me- but its what they're suggesting). By transferring before large increases are factored into the equation- and tax bill associated with the transaction are minimised- and it is a manner of transferring wealth from one generation to the next- legitimately minimising the slice that the taxman take from the transaction.

From the perspective of inheritance planning- it makes perfect sense.
From the perspective of the day-to-day tax affairs of the OP- it complicates them- and he/she will have to do a full tax return going forward- which isn't necessarily a bad thing.

Its future planning at a family level- and a lot of people are doing it at the moment- some solicitors offices are engaged almost solely on intergenerational transfers at the moment. Funnily enough- a lot of this seems to be related with property not in the Dublin area but elsewhere.