Returning deposit gift from parents

mobro123

Hi all, my parents gifted me £50k for a house deposit a few years ago. I'm now selling and intend to give them the £50k back. How can I do this without them having to pay tax/ answer questions about where the money has come from? Thanks,
Matt

AdrianC

There is no tax on gifts.

The reason you had to answer questions when you borrowed were given the money from them was because it was being used for a house transaction. There are no questions inherent in repaying a loan a gift.

mobro123

Thanks for the quick reply. So I can just bank transfer £50k? Would I need to fill in any forms to explain its a gift?

parkingadvice1212

Just transfer them £50k you won’t have any issues. It’s your parents you’re not sending it to Syria. 

davidmcn

mobro123 said:

Thanks for the quick reply. So I can just bank transfer £50k?

Yes.

Would I need to fill in any forms to explain its a gift?

No. Who do you think is going to ask you to fill in forms? As already explained, the reason anybody asked questions when you got the money was because it was (presumably) part of a mortgage-funded purchase, not because there's any general requirement for a bunch of paperwork for gifts. It would make Christmas very bureaucratic...

eddddy

mobro123 said:

Thanks for the quick reply. So I can just bank transfer £50k? Would I need to fill in any forms to explain its a gift?

You don't have to fill in any forms to give somebody a gift.

Unless, for example, your parents need proof it's a gift - maybe because they want to use it as a deposit for buying a house!  Or if HMRC decide to do an investigation into your parents tax affairs, you might then have to sign a letter confirming that it was a gift.

parkingadvice1212

davidmcn said:

mobro123 said:

Thanks for the quick reply. So I can just bank transfer £50k?

Yes.

Would I need to fill in any forms to explain its a gift?

No. Who do you think is going to ask you to fill in forms? As already explained, the reason anybody asked questions when you got the money was because it was (presumably) part of a mortgage-funded purchase, not because there's any general requirement for a bunch of paperwork for gifts. It would make Christmas very bureaucratic...

To be fair, my partner was interrogated by two members of staff in the bank a couple of weeks ago when she was trying to transfer me only £11k towards a house deposit!!

Sistergold

The bank when giving a mortgage Don’t want any other person laying a claim to your house thus it has to be a “gift”. 

Any other time we can all give or loan each other money as we please. Even though your parents gave you £50k you can now give them back double that amount if you choose as thank you maybe? Well just pointing out that just because they gave you £50k does not mean that you have to give back exactly £50k no one cares. 

davidmcn

parkingadvice1212 said:

davidmcn said:

mobro123 said:

Thanks for the quick reply. So I can just bank transfer £50k?

Yes.

Would I need to fill in any forms to explain its a gift?

No. Who do you think is going to ask you to fill in forms? As already explained, the reason anybody asked questions when you got the money was because it was (presumably) part of a mortgage-funded purchase, not because there's any general requirement for a bunch of paperwork for gifts. It would make Christmas very bureaucratic...

To be fair, my partner was interrogated by two members of staff in the bank a couple of weeks ago when she was trying to transfer me only £11k towards a house deposit!!

Yes, but that's just a "large transaction" procedure - the bank wouldn't care whether or not it was a gift, just that she was the account-holder and that it didn't look like money-laundering.

AdrianC

parkingadvice1212 said:

To be fair, my partner was interrogated by two members of staff in the bank a couple of weeks ago when she was trying to transfer me only £11k towards a house deposit!!

Banks take steps to ensure suspicious transactions are genuine, if they think somebody may be at risk of being defrauded. This is a good thing.

parkingadvice1212

AdrianC said:

parkingadvice1212 said:

To be fair, my partner was interrogated by two members of staff in the bank a couple of weeks ago when she was trying to transfer me only £11k towards a house deposit!!

Banks take steps to ensure suspicious transactions are genuine, if they think somebody may be at risk of being defrauded. This is a good thing.  

Surely “this is to my long term partner as we are buying a house” should be sufficient and not require another 20 minutes of questioning from the counter staff and branch manager over whether she was buying bitcoins or whether she was sent by head office to test their security procedures. 

They went as far as to demand a copy of the contract of sale which we don’t even have as the solicitor has it.