30k gift to help with house buying HELP!!!!

deathtoall

My partner and I are buying a house and my mum wants to give me 30k to help with the move however reading online it seems that she can only give 3k a year before we have to pay tax, or 5k if its for a wedding (we are getting married later this year).

Can she give us the money without having to pay inheritance tax?

We need it asap to be totally honest so not having to pay tax on it would be a great help.

Also...if I am gifted 30k does that immediately put me into the higher tax bracket after I have earned the 10k or so in my job that would take me above the 20% band??

ANY HELP WOULD BE MUCH MUCH APPRECIATED YOU CLEVER PEOPLE OF MSA FORUM. :eek: :T. :A

davidmcn

I don't know what you've been reading online, but either it's completely wrong or you've misunderstood.

Inheritance Tax is only an issue if and when your mum dies - if she does, then gifts she's made in the previous seven years can be deemed to form part of her estate. And if she doesn't gift the money then it's going to be part of her estate anyway...

And it's nothing to do with Income Tax - that's only relevant for earned money - from employment / self-employment / investment / rental income - not gifts.

You will need to check that your mortgage lender is happy with you using a gifted deposit.

agrinnall

Inheritance tax would only be paid if your mum dies within 7 years AND the total value of her estate is greater than either £325,000 or £650,000 if she has received the estate of her partner. And even if IHT is due it is paid by the estate not the beneficiary in almost all circumstance. The gift has no impact on your tax position as it is a gift, not income.

AnotherJoe

Just to back up previous posts.
Your mum can give you thirty gazillion pounds if she wants without you paying tax of any sort. Capital gains, income whatever. There is no tax on gifts in this country.
What you've been reading is about the possible consequences for inheritance tax. Hopefully your mum won't shuffle off this mortal coil in the next 7 years and even if she did it's unlikely to be a problem.
Your mum will have to sign a document for the lender stating that (1) this is a true gift with no need to repay it, and (2) she will not be living in the house. No biggie.

Slithery

deathtoall wrote: »

...however reading online it seems that she can only give 3k a year before we have to pay tax, or 5k if its for a wedding (we are getting married later this year).

Where on earth did you read all of that nonsense? Your parents can gift you as much as they want without you having to pay any tax.

JayRitchie

Have you been reading American forums?

Tom99

Is the gift an unconditional one to both you and your partner? Say you split up in 6mths or a year, would you be happy to split this gift with your partner?
If not you probably need to hold the property as tenants in common and have a deed of trust which says that on a sale you get back your £30k (or whatever %age of the house that bought) before the mortgage is paid off and the balance split 50/50.
Not very romantic I know, but couples splitting up soon after buying a property is not unknown.

Sea_Shell

Tom99 wrote: »

Is the gift an unconditional one to both you and your partner? Say you split up in 6mths or a year, would you be happy to split this gift with your partner?
If not you probably need to hold the property as tenants in common and have a deed of trust which says that on a sale you get back your £30k (or whatever %age of the house that bought) before the mortgage is paid off and the balance split 50/50.
Not very romantic I know, but couples splitting up soon after buying a property is not unknown.

I agree. Is she really 100% happy that she would be gifting you BOTH, or is she really only wishing to gift to you, so would want their half back if you split?

Also, is it a true gift. Not a ruse to say "yes, it's a gift (honest)" but then to have a "secret deal" that in fact you will pay her back eventually.

When you say "to help with the move" do you actually mean, for the DEPOSIT? As she'll no doubt have to sign a letter to your lender confirming the gift is a gift without reservation, if that is the case.

Sorry if we sound wary, but we read the fall out from these arrangements MANY times on these boards, so have become aware of the potential bumps in the road.

AnotherJoe

Tom99 wrote: »

Not very romantic I know, but couples splitting up soon after buying a property is not unknown.

Good advice as It appears to be "de rigeur" in this forum