In the case of married couples it is important to note that Inheritance Tax is normally only payable after the second death and where your combined estates currently exceed £650,000.  

If you are considering making gifts during your lifetime then you need to be aware of the rules relating to gifts involving a ‘reservation of benefit’. These rules mean that one cannot give away assets, but continue to enjoy any kind of benefit from them.

If you give away property, either in whole or in part, but continue to live in it without paying a full market rent, HMRC will still treat it as yours on your death and tax it accordingly.

You will also lose the benefit of Capital Gains Tax 'main residence relief', so that if the property is later sold there may be capital gains tax to pay on any gain in the value of the property from the date it was transferred to your son.

In some cases individuals may be tempted to transfer property to family members in return for paying a full market rent to continue to live in the property. However, in this case there must be a proper Tenancy Agreement in place, with provision for rent reviews. Any rental income will be taxed as income in the hands of the beneficiaries.

There are also practical reasons why transferring your home to children is undesirable. It is important to bear in mind that, despite their best intentions, there may be circumstances beyond your children’s control that could mean you having to leave your home.

For example, if a child went through a divorce or bankruptcy the property would form part of their assets to be divided accordingly. Similarly, if your child died without making provision for you in their Will your home would form part of their estate, transferring to the beneficiaries under the terms of any Will or intestacy.

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