‘Should I give my home to my daughter now or will it to her?’

Q: What is the best way to proceed after retirement? I wish to move out of my house on a small acreage and succeed it to my daughter and her partner, while I live in my motorhome and use a shed on the property as a base, so I can just travel and house-sit. I just need to know the legalities; is it best to just name them in my will or gift it to them?

A: Your question is a juicy one and invites a very long and detailed answer that is beyond the ambit of this column.

However, here’s some general advice:

• Your proposal can have significant tax e.g., capital gains tax and Centrelink implications. Some of these implications are explored in a column published by Starts at 60 on the pros and cons of granny flats (for Centrelink purposes, a granny flat is not about what form your housing takes but the financial arrangement it involves).
• No arrangement with them, while you are alive and along the lines you are suggesting, should ever be entered into without legal and financial advice.
• Any such arrangement should be properly documented, not left to a handshake and a ‘she’ll be right’. For a taste of why I say this, though, please see a previous column in which I addressed some of the many issues that can turn similar agreements sour. And when you think you’ve seen it all, here’s a few more!
• I have seen many of these types of arrangements fall down because no one applied the ‘what if’ analysis e.g., what if you need large amounts of money in your later life for aged care?

I hope that hasn’t discouraged you – it is meant to encourage you to do it right.

If you have a question for Starts at 60’s money experts, email it to [email protected].

IMPORTANT LEGAL INFO This article is of a general nature and FYI only, because it doesn’t take into account your financial or legal situation, objectives or needs. That means it’s not financial product or legal advice and shouldn’t be relied upon as if it is. Before making a financial or legal decision, you should work out if the info is appropriate for your situation and get independent, licensed financial services or legal advice.