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Income tax and mortgage question
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North_South_2
Posts: 4 Newbie
Please bear with me because my story is unusual and rather complex.
My parents own their home and have a small mortgage (£15k). They want to remortgage their home to release equity for home improvement (£50k).
No mortgage company will offer them a deal because they are too old. The affordability of monthly repayments is not a problem for them.
My bank has said that they will offer ME a mortgage on my parent's house and I will be added to the deeds as a joint owner.
The new mortgage will be in my name alone and the deeds of the house will have all three of us on it. My parents will continue to live in the house. I do not live there, I live in a different city.
The plan is that my parents will pay the mortgage money to me monthly, and I will then use this to pay the bank.
My question is: Will I have to pay income tax on the money that my parents pay me to pay the mortgage?
All advice appreciated
My parents own their home and have a small mortgage (£15k). They want to remortgage their home to release equity for home improvement (£50k).
No mortgage company will offer them a deal because they are too old. The affordability of monthly repayments is not a problem for them.
My bank has said that they will offer ME a mortgage on my parent's house and I will be added to the deeds as a joint owner.
The new mortgage will be in my name alone and the deeds of the house will have all three of us on it. My parents will continue to live in the house. I do not live there, I live in a different city.
The plan is that my parents will pay the mortgage money to me monthly, and I will then use this to pay the bank.
My question is: Will I have to pay income tax on the money that my parents pay me to pay the mortgage?
All advice appreciated
0
Comments
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This is one for an accountant - not the mortgage forum.
There are a number of potential taxation issues here that you need to get advice on - so speak to a qualified accountant.I am a Mortgage Broker
You should note that this site doesn't check my status as a Mortgage Broker, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.0 -
Really?North_South wrote: »My bank has said that they will offer ME a mortgage on my parent's house and I will be added to the deeds as a joint owner.
The new mortgage will be in my name alone and the deeds of the house will have all three of us on it. My parents will continue to live in the house. I do not live there, I live in a different city
A property with ownership in three names and the mortgage in only one?
Which lender is offering this?I am a mortgage broker. You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice. Please do not send PMs asking for one-to-one-advice, or representation.0 -
£50k for home improvement?
Building a 25 metre swimming pool?0 -
Don't get told excited KS - we haven't seen the offer yet!I am a Mortgage Broker
You should note that this site doesn't check my status as a Mortgage Broker, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.0 -
kingstreet wrote: »Really?
A property with ownership in three names and the mortgage in only one?
Which lender is offering this?
Lender is HSBC0 -
Definitely, don't get too excitedI am a Mortgage Broker
You should note that this site doesn't check my status as a Mortgage Broker, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.0 -
HSBC will allow more borrowers on the mortgage than there are on the deeds, but not the other way round.
Check what you've been told.I am a mortgage broker. You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice. Please do not send PMs asking for one-to-one-advice, or representation.0 -
kingstreet wrote: »HSBC will allow more borrowers on the mortgage than there are on the deeds, but not the other way round.
Check what you've been told.
It is as I wrote. As part of the mortgage offer, the bank insisted that my parents obtain independent legal advice.
I think we're getting sidetracked from my original question about income tax though...0 -
North_South wrote: »It is as I wrote. As part of the mortgage offer, the bank insisted that my parents obtain independent legal advice.
I think we're getting sidetracked from my original question about income tax though...
Try an accountant.I am a mortgage adviser.You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.0 -
As joint owners no tax implications.
You will not obtain a mortgage independently of their ownership. So your question has no bearing.0
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