Cash gifts NOT gifted deposit

AnnOff

Hello everyone,
I read many helpful posts regarding gifted deposits but haven't found much about declaring and using gifted cash from parents towards the deposit.

It looks like my dad (he lives in Poland) who wants to gift me some money towards deposit would need to come over to UK to get his passport and bank statements verified. I would like to save him some hassle and I was wondering if he gifts me £3000 before end of tax year and then £3000 month later, in a new tax year, would he still need to come over to sort out paperwork? Could it not be just gifted money without specifying that it's towards a deposit? How do I classify it then for the mortgage application purposes - "savings" or "gift"?

I will have about £18000 of my own savings here in UK and that £6000 from my dad is to make sure I can secure a higher mortgage.

I would appreciate your help and advice.

Thank you!

steampowered

Another option would be for your Dad to get certification done in Poland - perhaps by a Polish notary.

boo_star

It depends on your solicitors.

Most will want to know the source of the funds going back potentially 3 years, so whether it is a gift or a gifted deposit is irrelevant, he'll need to show where the money has come from.

There aren't any tax implications to a gift in the UK (outside of IHT) so trying to spread it over 2 tax years is a waste of time.

To be honest if the money has come from a family member in what is basically a lump sum they'll probably want them to sign a gifted deposit form anyway, if the transfer happened in the past few months.

getmore4less

Simple way to convert cash gifts to savings is spend the gifts and increase savings from income.

How many months till you plan to buy

panterka

Hi AnnOff,

I have done it, as in... had some money sent from dad prior to buying a property.
He did not have to come to the UK to get his ID checks done, it was all sent via email and then registered mail. He didn't even go to solicitor to countersign his passport copy, just a work colleague did it for him with a work stamp (he works in a hospital) and no official translation were required for ID checks.
Bank statements were printed from his online banking and did not get were not translated.
The only thing that had to be signed by a local solicitor and translated back from English to Polish, was a 'gift declaration'. Overall, it cost me about £300 including £200 fees from UK solicitor for 'gifted deposit' handling, even though it was only a small abount of money I was getting (just over £3000).
And yes... even a small amount of money towards your deposit, counts as a gifted deposit, even if you have however much in your bank.
As an afterthought... I should have overdrawn my bank account to send money to solicitor prior to exchange and then get money from dad before end of month, to avoid all this faff.

Wanderingpomm

I’ve just got a mortgage and they just wanted the funds to be in the count for 3 months so you could put £3k in now and then that will be well established in for the next tax year.

AnnOff

Thank you all for your reply.

I will be reserving a plot by the end of January, by the end of February I need to sign a missive and I will need to release the funds about June/July. So maybe if he transfers that money into my account in December so it will be sitting in my account for all those months I will be OK and only my statements will be required?

davidmcn

AnnOff wrote: »

I will be reserving a plot by the end of January, by the end of February I need to sign a missive and I will need to release the funds about June/July. So maybe if he transfers that money into my account in December so it will be sitting in my account for all those months I will be OK and only my statements will be required?

Possibly, it depends on the policy of whoever is looking at it. Often solicitors only look back three months, so you'd be fine. If evidence is needed from your dad, he can get somebody local to certify his ID/bank statements, don't know who told you he'd need to visit the UK.