Regular Gift Income for Credit Card Applications

qasw

Hi,

I have been unable to find a firm answer for this for the UK so far:
1) Can ‘regular gifts’ count as income for credit card applications (as a student this is a lot of my income)
2) If some of this money is conditional on investing it can/should that be counted
3) Would the bonus received on a lifetime ISA count

Thank you.

msallen

No, N/A, No

qasw

Do you have a source for this because I know this is allowed in the US and have found some indications it is accepted by some credit vendors in the UK

Terry_Towelling

My view (that's all it is) is that income can only be counted as income if it comes from an external source and, it increases (albeit probably temporarily) your wealth and if there is some sort of legal entitlement to it. So a paid job should count, but a gift should not because you have no legal entitlement to receive it.

Income is also usually liable to Income Tax (subject to allowances) but gifts do not attract Income Tax in the UK and so that is quite a compelling reason for a gift not be classed as income (in, as I say, my view).

Sea_Shell

But it could be argued that gifts from, say, a parent, might actually be more secure than a salary!!

Especially if you've only worked somewhere for a short time.

jcontest

It could be argued that if your parents get mad at you after 18 years of supporting you that they don't need to supply 18 weeks of redundancy and 18 weeks of notice.


I have seen some applications say EARNED income and others that say exclude benefits. I wouldn't include "gift" money unless it's regular and shows up on bank statements. So Grandad paying £100 a week to you via standing order I would include... Auntie Marp giving you £500 at Christmas I wouldn't. Whatever you do, keep it consistent across all applications.


You should ignore the way the Americans do it. There is a reason why "sub-prime" lending is a problem in the USA.

Terry_Towelling

Yes, but as stated in post #4, surely the key to understanding income is to understand Income Tax. If your income could be subject to Income Tax, then it is Income (capital 'I'); if it isn't subject to Income Tax, then it isn't Income.

If granddad pays you £100 a week because you do his garden for him, that could be construed as Income and subject to Income Tax; if he gives you £100 for nothing in return that is a gift and not subject to Income Tax.

If you choose to declare gifts as Income when applying for credit, that's up to you - and you can quite easily plead ignorance if, when asked by a lender for proof of said income, you believed it was allowable. I'm sure they won't hold it against you but they may refuse to grant credit.

Just my twopenneth.

PS, @jcontest, could you put in a good word for me with your Auntie Marp as she seems very generous at Christmas time. BTW, what is 'Marp' short for?:)

jcontest

Terry_Towelling wrote: »

PS, @jcontest, could you put in a good word for me with your Auntie Marp as she seems very generous at Christmas time. BTW, what is 'Marp' short for?:)

A Shortened Miss Marple.


I too would be hesitant to use gifted money as income. Odd to me that the process isn't allowed to give NI numbers so credit reference agencies can see what you have declared as earnings. It would stop a lot of account opening fraud.