Twenty-five years ago, my mum put part of a down payment on my house. I was going through a divorce. The monies came from injury compensation prior to marriage, but I was worried he would take it. The house stayed in mum’s name all these years. I made payments to her and she retained the loan. She wants to sign it over to me now. Can I retain the current tax base and do I have to pay huge taxes on it? There is a lot of equity. The loan is still in her name; my name is not on it. My brother thinks the house should be in her trust to be divided. My mum wants me to have the house. I'm partially disabled and I have no money to pay taxes on the equity. I'm getting conflicting advice.

Arthur Weller replies:
There is a possibility to argue that your mother was purely a legal owner, nominee or bare trustee of the house, but you had the beneficial ownership all along. Because some of the original funds to purchase the house came from you, and you occupied the house all the time. See www.gov.uk/hmrc-internal-manuals/capital-gainsmanual/cg70230. If so, transferring the house from her legal ownership to yours will have no tax consequences. See www.gov.uk/hmrc-internal-manuals/capital-gainsmanual/cg10720. You can strengthen this argument by your mother now writing a declaration of trust, saying that from the beginning she has held this property on trust for you, see www.gov.uk/hmrc-internal-manuals/capitalgains-manual/cg65406. However, it must be stated that HMRC may challenge this argument.