Can we give our daughter some money to help her buy a bigger house. 10 November 2020 at 9:40AM in MoneySaving mums 11 replies 1.4K views

dotty60

We have approx £350000. Is it possible to give our daughter some money to help her buy a bigger house. Will there be taxes to pay

Keep_pedalling

We don’t have gift taxes in the U.K. so there is no tax to pay. 

SunnyCyprus

https://www.gov.uk/inheritance-tax/gifts
I would read this^^^

AnotherJoe

Yes you can give as much as you want.

The potential issues down the road are Deprivation of Assets and Inheritance tax. If neither of those seem likely then theres no issue.

As said, there is no tax to pay.

Couldsavemore

my parents 'gave' me 50k (their life savings) to help me buy my house.
The mortgage company did question the size of my deposit given I wasn't selling a house. They asked for a letter stating it was a gift that did not need to be repaid. This was about 8 years ago.
So yes you can!

I think if the mortgage company think its a loan, they include the repayment  in the affordability checks they do.

I have been 'gifting' them £200 a month since I bought my house.  I will till I've 'gifted' them the full amount back.  

Its worked out well for us. 

Aranyani

Couldsavemore said:

my parents 'gave' me 50k (their life savings) to help me buy my house.
The mortgage company did question the size of my deposit given I wasn't selling a house. They asked for a letter stating it was a gift that did not need to be repaid. This was about 8 years ago.
So yes you can!

I think if the mortgage company think its a loan, they include the repayment  in the affordability checks they do.

I have been 'gifting' them £200 a month since I bought my house.  I will till I've 'gifted' them the full amount back.  

Its worked out well for us. 

You do realise you committed mortgage fraud, don't you? 

Savvy_Sue

Aranyani said:

Couldsavemore said:

my parents 'gave' me 50k (their life savings) to help me buy my house.
The mortgage company did question the size of my deposit given I wasn't selling a house. They asked for a letter stating it was a gift that did not need to be repaid. This was about 8 years ago.
So yes you can!

I think if the mortgage company think its a loan, they include the repayment  in the affordability checks they do.

I have been 'gifting' them £200 a month since I bought my house.  I will till I've 'gifted' them the full amount back.  

Its worked out well for us. 

You do realise you committed mortgage fraud, don't you? 

It is possible that parents gave the money, and child has chosen to repay?

Aranyani

Savvy_Sue said:

Aranyani said:

Couldsavemore said:

my parents 'gave' me 50k (their life savings) to help me buy my house.
The mortgage company did question the size of my deposit given I wasn't selling a house. They asked for a letter stating it was a gift that did not need to be repaid. This was about 8 years ago.
So yes you can!

I think if the mortgage company think its a loan, they include the repayment  in the affordability checks they do.

I have been 'gifting' them £200 a month since I bought my house.  I will till I've 'gifted' them the full amount back.  

Its worked out well for us. 

You do realise you committed mortgage fraud, don't you? 

It is possible that parents gave the money, and child has chosen to repay?

The fact that they put ‘gave’ in inverted commas rather suggests otherwise.

Mickey666

Aranyani said:

Couldsavemore said:

my parents 'gave' me 50k (their life savings) to help me buy my house.
The mortgage company did question the size of my deposit given I wasn't selling a house. They asked for a letter stating it was a gift that did not need to be repaid. This was about 8 years ago.
So yes you can!

I think if the mortgage company think its a loan, they include the repayment  in the affordability checks they do.

I have been 'gifting' them £200 a month since I bought my house.  I will till I've 'gifted' them the full amount back.  

Its worked out well for us. 

You do realise you committed mortgage fraud, don't you? 

If there is no legal agreement in place for the OP to repay the 'gift' from their parents then where is the mortgage fraud?

The fact that the OP has chosen to give their parent £200 a month is a private arrangement and therefore completely irrelevant as far as the mortgage company is concerned.  It is also well below the £3000 per year gift limit so there are no tax implications.

I'd bet there are parents up and down the country who have given their children money towards buying a house and why shouldn't they?  Who cares?  The mortgage company is getting their repayments and the parents/children's financial affairs are their own private business. 

Aranyani

Mickey666 said:

Aranyani said:

Couldsavemore said:

my parents 'gave' me 50k (their life savings) to help me buy my house.
The mortgage company did question the size of my deposit given I wasn't selling a house. They asked for a letter stating it was a gift that did not need to be repaid. This was about 8 years ago.
So yes you can!

I think if the mortgage company think its a loan, they include the repayment  in the affordability checks they do.

I have been 'gifting' them £200 a month since I bought my house.  I will till I've 'gifted' them the full amount back.  

Its worked out well for us. 

You do realise you committed mortgage fraud, don't you? 

If there is no legal agreement in place for the OP to repay the 'gift' from their parents then where is the mortgage fraud?

The fact that the OP has chosen to give their parent £200 a month is a private arrangement and therefore completely irrelevant as far as the mortgage company is concerned.  It is also well below the £3000 per year gift limit so there are no tax implications.

I'd bet there are parents up and down the country who have given their children money towards buying a house and why shouldn't they?  Who cares?  The mortgage company is getting their repayments and the parents/children's financial affairs are their own private business. 

They probably won't get caught, most don't, but its still fraud.  They signed a declaration that the sum of money was a gift when it wasn't, it was always going to be a loan. 

If the mortgage company knew it was a loan, they probably wouldn't have given them the mortgage, therefore they obtained money by deception, the definition of fraud.

Mickey666

I disagree because you cannot know that for certain.  Let’s assume it genuinely was a gift and the declaration was honest and true at the time.  Now imagine that the parent’s circumstances somehow changed.  Are you seriously suggesting that the OP would not be able to ‘help out’ their parents without committing mortgage fraud?