Tax liability on inheritance of property - tenants in common

Good morning – my parents owned their house as Tenants in Common, with each leaving their half to me in their will. My father died 3 years ago, so I now own half the house, as I understand it. My mother is very elderly, so I'm giving some thought to inheritance when she dies. Ideally, I’d like at least half of the house to go to my daughter. As things stand, obviously I can inherit my mother’s share, sell the house, then pass either half or all or whatever to my daughter, but I think there would be tax implications for her, especially if I die within 7 years? It’s occurred to me that my mother could change her will to leave her half of the house directly to my daughter – would this remove any tax liability from her? Sorry, but I really struggle to understand this stuff, despite having devoted many hours to reading about it ☹ Thanks

Hi,

Inheritance Tax Inheritance tax is a tax on the estate (property / money / possessions) of someone who has died.

There is normally no inheritance tax to pay if the value of the estate is below the threshold of £325,000. 

Inheritance tax is only due when a person's estate is worth over £325,000 when they die, or if the person who died gave away more than £325,000 in gifts in the 7 years before they died.

Gifts made in the last 7 years before someone dies, use up the £325,000 tax free allowance first, but if the gifts received are less than the £325,000 inheritance tax free allowance, any unused

threshold can then be used by the person who has died's estate. 

You can find out more information here:

Work out Inheritance Tax due on gifts

Thank you.

Thank you so much for replying. Unfortunately, I'm still struggling - this sort of thing is my mental Achilles' Heel... So I'm not talking about inheritance, really, just if I give a large gift (say £100,000) to my daughter after I inherit the remaining half of my mother's house. As that would be a simple gift from me to my daughter, nothing to do with inheritance, I'm assuming it would be taxable, so she'd lose a lot of it? Hope I'm making myself clearer than perhaps I did initially. Me inheriting the remaining half of my mother's estate, and my giving money to my daughter from the subsequent sale of the house, would seem to be entirely separate transactions - whereas, if my mother changed her will to leave her half of the property directly to my daughter, presumably there would be no question of tax liability? Sorry if I'm being thick here :-(

Hi,
If you inherit the remainin half of your late mother's house, so that you own 100% of it and you then dispose of it, you may have capital gains tax to pay on the disposal.  
Out of the sale proceeds, you give your daughter a large sum of money, there is no tax payable on the cash gift to your daughter, for either you or your daughter, but if you die within 7 years of making the cash gift, the amount gifted to your daughter then counts towards your estate for inheritance tax purposes.  If you live longer than 7 years then it does not count towards your estate for inheritance tax purposes.  
If your daugher was to inherit 50% of her late grandmothers house, then she may have capital gains tax to pay on her disposal of her 50% of the property.  
Any cash gift, given or received, are not taxable.  
Any gift over £3000 must be considered for inheritance tax purposes.
Thank you.