Buy to Let for Mum
9:27 AM, 11th September 2014, 12 years ago
11
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Can I buy some BTL property (I have deposit and good credit rating), let it to my Mum at a below market value (just cover mortgage payments) and allow her to sub let to provide income for her but without IHT issues?
Thanks
Martin
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Member Since July 2013 - Comments: 1264 - Articles: 1
2:21 PM, 15th September 2014, About 12 years ago
Reply to the comment left by “Mark Alexander” at “12/09/2014 – 15:07“:
You can pay her whatever you wish but if it is being offset against tax then it would have to be in line with the work done. Otherwise there would be questions asked by HMRC. Since she wouldn’t own it there wouldn’t be any IHT to worry about.
You don’t say how old your mother is, so it’s not clear if you want to provide for her or give her a job. 10 properties would nowhere near equate to £2000 per month. Would you pay £200 per month to an agent per property?
Why not rent it yourself and give her an allowance from the rent? Or buy it jointly and have her declare the income as hers (e.g. if she is a lower rate tax payer than you) – potentially you could be in the IHT bracket though depending on its value.
Also you talk about her running a company – this requires quite a lot of expertise which it sounds as though she doesn’t have….