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  • Thomas Bradley & Co

Can I Gift My House to My Children?

Updated: 4 days ago

Your home will ultimately be a place filled with joyful memories and happy moments. As you start thinking about the future, you may have come to a realisation that you want to keep the home in the family. Gifting a property can be a useful way to reduce the potential tax liabilities your children could incur when they inherit your estate and can also ensure the home stays in the family.





This decision is one which will require careful planning as gifting your home can potentially result in legal or tax issues. In this guide, we will explain how you can gift property to your children whilst providing information regarding the potential tax implications, and provide the necessary steps you need to take.


Can You Gift Property to your Children?


Yes, if you own your home and do not have an outstanding mortgage - you can gift the house to your children. The most common way to gift your home is known by a Transfer for Nil Consideration, popularly known as a Deed of Gift.

When you gift your property, you will also reduce the amount of Inheritance Tax (IHT) you need to pay.


To find out more about Inheritance Tax, click here.


However, before you start planning for this you must meet the four conditions that allow you to successfully gift property to your child.


  1. Be of sound mind and not acting under pressure.

  2. Be listed as the owner with the HM Land Registry.

  3. Have no outstanding mortgage on the property. If you do have an outstanding mortgage, you can transfer equity instead.

  4. Ensure that there is no charge secured against the property.


What are the tax implications of gifting property to my children?


When you use a transfer to gift your property it means that no money has been exchanged during the transfer. You, as the owner of the property have surrendered your interest in the protest and received no monetary gain.


The main benefit of transferring ownership to your children is reducing your inheritance tax liability. Gifting a property at least seven years before you pass away can reduce the overall value of your estate which in turn negates or reduces the amount of inheritance tax your children will need to pay. This is known as the seven year rule and is an essential element of estate planning.


Can I remain in the property once it has been gifted?


You can stay in the property once you have gifted it to your children. However, you must:


  • Pay rent at the same rate as similar local rental properties.

  • Pay bills.


If you remain in the property rent free after ownership has been transferred, the property will not be exempt from Inheritance Tax (IHT).


Are there risks involved when transferring property?


Due to the permanent nature of a property transfer, there is ultimately risk involved. Once you gift the home to your children, you are no longer the homeowner and therefore have given up any legal rights to the property.


Although this is not always a problem, it will place you in an unprotected position if you intend to keep living in the home.


If the following situations occur:


  • You are evicted from the property if they intend to sell it or due to a family disagreement.

  • If your child is married and encounters complications within their marriage - the property could be sold as part of a divorce settlement.

Therefore, like any other big life decision, we implore you to think carefully before you move ahead and ensure you have conditions in place which protect you and them.


Contact Us


To find out how you can gift property to your children and any potential implications you may incur, get in touch with us today!



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