My sister and I jointly own a house in Manchester which is rented. We would like to transfer the ownership of the property to my sister's daughter who is twelve years old. Is this possible?
Arthur Weller replies:
You can certainly transfer the property the property to your 12-year-old niece. But there are a few things you should be aware of. In this country, a minor (under 18 in England) cannot legally own property, so someone will have to be the legal owner, and own it on bare trust for your niece, who will be the beneficial owner. Secondly, when a parent transfers an asset to a minor child, and the asset produces more than £100 income per year, the parent is liable to income tax on that income until the minor reaches the age of 18.
This question was first printed in Property Tax Insider in October 2018.