Difficult situations
Can I Sell My House to My Son or Daughter for £1?
Yes — you can transfer your house to your child for £1 or below market value (effectively a gift), but it has significant implications: Capital Gains Tax (a gift is treated as a disposal at market value if not your main home), the seven-year Inheritance Tax rule, "deliberate deprivation of assets" if done to avoid care fees, any mortgage needing the lender’s consent, and Stamp Duty if debt is taken on. Take legal and tax advice first.
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- £1is a gift in effect
- CGT/IHTand care-fee rules
- 7-28 dayscash if selling instead
You can do it — but it is a gift
Transferring your home to your son or daughter for £1 (or any figure well below market value) is, in substance, a gift of the property (or of the difference between £1 and its value). It is done via a TR1 transfer registered at HM Land Registry, handled by a solicitor (see transferring to family). Legally you can do it — but the tax and other consequences are why it needs careful thought and advice.
Capital Gains Tax
For Capital Gains Tax, a gift to a child is treated as a disposal at market value, not at the £1 you actually receive. If the property is not your main home (for example, a second property or one you have let), CGT may be due on the gain — even though you got only £1. If it is your main home, Private Residence Relief usually exempts it. So the CGT position depends on whether the home has been your main residence (see avoiding CGT).
Inheritance Tax and the seven-year rule
| Scenario | IHT effect (potentially) |
|---|---|
| You survive 7 years | Gift generally falls outside your estate |
| You die within 7 years | Gift may be counted, with taper relief after 3 years |
| You keep living there rent-free | "Gift with reservation" — stays in your estate |
A common trap is the "gift with reservation of benefit": if you give the home away but keep living in it rent-free, it usually stays in your estate for IHT.
Care fees and other risks
A frequent motive is to protect the home from care fees — but beware: if a council judges the transfer was to deliberately avoid care-fee assessment ("deliberate deprivation of assets"), it can assess you as if you still owned it, undoing the benefit (see selling to pay for care). Other risks: any mortgage needs the lender’s consent and must be dealt with; Stamp Duty can arise if your child takes on mortgage debt; and you lose control of the property (your child’s divorce, debts or death could then affect it).
Is it a good idea?
Transferring to a child for £1 can suit some estate-planning aims, but it is not a simple or risk-free way to "give the house to the kids" — the tax, care-fee and control issues are real. Always take legal and tax advice first. If your underlying aim is simply to release cash or sell rather than keep the home in the family, a straightforward sale — including a fast cash sale in 7-28 days — may be cleaner and simpler.
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Written & reviewed by Lisa Hayes, Founder
Lisa Hayes is the founder of Ready Steady Sell and an independent UK home-selling expert with over a decade helping homeowners weigh cash house buyers, property investors and the wider fast house-sale industry — without pressure or hidden fees. Every guide is reviewed for accuracy under our editorial standards.
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Frequently asked questions
Straight answers, no sales talk
Can I sell my house to my child for £1?
Yes — you can transfer it for £1 or below value (a gift in effect), via a TR1 registered at HM Land Registry. But it has CGT, Inheritance Tax, care-fee, mortgage and Stamp Duty implications.
Do I pay Capital Gains Tax selling to my child for £1?
Possibly — a gift is treated as a disposal at market value, so CGT may apply if the property is not your main home. Your main home is usually exempt under Private Residence Relief.
Does the seven-year rule apply to selling my house to my child?
Yes — if you survive seven years the gift generally falls outside your estate for IHT; if you die within seven years it may be counted, with taper relief after three years.
Can I give my house to my children to avoid care fees?
Beware "deliberate deprivation of assets" — a council can assess you as if you still owned it if it judges the transfer was to avoid care fees. There is no simple, safe way to do this.
What if I keep living in the house after giving it away?
That is usually a "gift with reservation of benefit", which keeps the property in your estate for Inheritance Tax. Take advice before doing this.
Is selling to my child for £1 a good idea?
It can suit some estate-planning aims but carries real tax, care-fee and control risks. Take legal and tax advice. A straightforward sale may be cleaner if you just want to release cash.