Does a rent-free arrangement make her a tenant?

My children’s great grandfather in his will left the equity in his house 50:50 between his son and daughter ie my children’s grandfather and his sister (their great aunt), with the proviso that the great aunt lived in the property rent free for the remainder of her life. Decades later both grandfather and great aunt still alive.. At this point the grandfather (for inheritance tax planning) has a deed written up to gift his 5 children (including my children’s father) the grandfathers 50% share of the property. As grandfather can gain no material benefit from the property until great aunt dies, no taxes to pay on this gift when gifted. Great aunt dies about 10 years later (donating all her 50% equity to charity) whist grandfather still living the house is sold and each of the 5 children inherit 10%. Thereby his children benefited from a share in their great grandfather's property before the grandfather died and 40% on that 50% that house value in inheritance tax avoided at DOD of grandfather some years afterwards.

Reply to the comment left by Paul at 22/01/2025 - 18:59
Property inspection implies you are a landlord. If it’s your dad’s friend’s home until she passes then I wouldn’t be doing inspections.

Reply to the comment left by Paul at 22/01/2025 - 10:15
here are more info. for you to refer following Kizzie's comment:
The 'Inheritance and Trustees' Powers Act 2014 made several amendments to the 'Inheritance (Provision for Family and Dependants) Act 1975'. The main points:

1. Extended Categories of Applicants: The amendments expanded the categories of relatives and dependants who can apply under the Act. This includes any person treated by the deceased as a "child of the family" in any family where the deceased had a parental role, not just in relation to a marriage or civil partnership.

2. Dependants' Maintenance: The amendments clarified the interpretation of dependants being maintained by the deceased. It established that a person could be treated as being maintained by the deceased even if the deceased was making a substantial contribution towards that person's reasonable needs without full valuable consideration.

3. Simplified Claims: The amendments simplified the process for claims by dependants and those treated as a child of the family outside the context of marriage or civil partnership.

4. Relaxation of Time Limits: The amendments relaxed the time limits for making claims under the Act.

These changes aimed to modernize and simplify the provisions for family and dependants, ensuring fairer treatment and easier access to claims.

Just as a response although not expecting a definitive answer and it does not further
the debate regarding the original poster’s question.
Where couples have moved in together and not entered a civil partnership and one dies leaving the other with parental responsibilities and/or:
One partner not in a civil partnership dies and children over 18
Would the respective wills have to express a statement of intention and reference the Act and state child of the family

Reply to the comment left by Judith Wordsworth at 25/01/2025 - 08:06
Agreement allows yearly inspections. How else would I know if the property was being maintained properly?

It seems that the arrangement you have with your father's long-term carer/lady friend is more akin to a license rather than a tenancy. Here are some key points to consider:

Applicability of the Housing Act
1. Housing Act 1988: The Housing Act 1988 primarily covers assured and assured shorthold tenancies. Since your arrangement does not involve rent and is based on a legal agreement specifying that the property will return to you upon her death, it is unlikely to be classified as an assured or assured shorthold tenancy

2. License Agreement: The arrangement appears to be a license, where the carer has permission to occupy the property without exclusive possession. Licenses are generally not covered by the Housing Act 1988

Legal Obligations
1. Gas Safety Checks: Even though the arrangement is not a tenancy, it is advisable to conduct regular gas safety checks to ensure the safety of the occupant. This is a good practice to follow for any property owner.

2. Electrical Safety: Similarly, regular electrical safety checks are recommended to prevent any potential hazards.

3. Maintenance and Insurance: Since the agreement states that the carer is responsible for maintenance, insurance, and usual bills, you should ensure that these responsibilities are being fulfilled.

Reply to the comment left by c yu at 25/01/2025 - 19:38
I think you're forgetting 'monies worth" in lieu of rent. Maintenance of the property usually qualifies and could bring the occupant within the provisions of the Housing Act 1988.