NSW How to Give House to My Son under Property Law?

[onyx]

Hi,

Thank you for this site.

I have recently been left a house which I would like to move into. I already own a house and would like to transfer/give it to my son who has no house. What is the cheapest way of doing it under Property Law?

Thank you

 

[James D. Ford - Solicitor]

Hi Onyx

Step 1 - Decision regarding Gift to your son (or his control) or declare Trust (and retain control)

Option 1

So that the transaction be properly documented as a transfer by way of a Gift, it is recommended that you document the transaction in a Deed of Gift.

Option 2

Alternatively, you could retain control of the Property, via a Declaration of Trust, that has yourself or a Trust entity that you control as Trustee, or has you as the Sole Director of a Corporate Trustee, and hold the Property on trust for your son as Beneficiary.

Considerations

There are important considerations between these two options.

The major difference being that a Trust retains control with yourself, and provides a chance that your son will continue to enjoy the benefit of the house, even if he has a marital breakdown, or becomes bankrupt, at some time in the future, whereas a Deed of Gift would provide your Son with absolute control over the Property, to sell it, to mortgage it, etc., and the Property could be lost in a worst case scenario.

A transfer to your son's personal name, or to a legal entity under his control.. may trigger First Home Owner Grant entitlements, stamp duty exemptions... etc, and this also needs to be considered.

Step 2 - Transfer, and registration in the Titles Office

The transfer of title is procedural, and will cost the same regardless of the type of transfer.

Unless a exemption, or concession can be claimed (for example First Home Owner - Stamp Duty will apply).

Kind regards

 

[onyx]

Hi,

Thank you for this site.

I have recently been left a house which I would like to move into. I already own a house and would like to transfer/give it to my son who has no house. What is the cheapest way of doing it under Property Law?

Thank you

Thank you James for your clear answers. I will start sorting out which way I now want to go. Your answer was very much appreciated.

Kind regards.

 

[onyx]

Hi James,

Given that my son will have no stamp duty exemptions and the duty will be substantial, can I nominate him to inherit the house instead of me to benefit from stamp duty exemptions with inheritance?

Also, one other thing that may not be your domain but it's been very hard to find such clear answers even from paid help over the years. The house being inherited has my husband threatening to take me to court to get more money that he got from the consent orders between us drawn up 3 years ago (and stamped) when he left me for poker machines.. He is saying because we are not yet divorced and still catch up a day a week he has a claim. Should I be looking at getting divorced?

Thanks

 

[James D. Ford - Solicitor]

Hi,

If a gift under a Will is not distributed directly to the Beneficiary named in the Will - tax and duty consequences will ensue. There is no way around this...

It is not my area, but here in my understanding of your situation.

You can reach a binding property settlement anytime after you are separated and before you are divorced.. and that is what you have done by lodging the consent orders, as soon as possible after you both separated.

The fact you have done this (and have a binding property settlement) protects you against what you husband is currently attempting to do... take advantage of a change in your financial circumstances... once your consent orders were stamped by the Court, as being fair and reasonable, you became financially free of your husband.

If you re-started your marriage... this would be another matter.

Catching up once a week, as friends do... in my opinion does not in any reasonable person's mind... or at law... constitute re-starting the marriage.

In order for there to be no doubt, you should tidy up the loose end, and file for divorce. There are other legal implications of still being "legally" married, even though you have physically separated long ago.

Kind regards