AvoidDebt Posted December 13, 2016 Share Posted December 13, 2016 It's in FT. Google it. What are the potential implications of this? Wasn't BOMAD supposed to be the 10th biggest lender in the country. Could this be another prop that the government is dismantling, if so, would be proof positive that this govt. is 100% committed to a HPC. Quote Link to comment Share on other sites More sharing options...
spyguy Posted December 13, 2016 Share Posted December 13, 2016 If they had gifted the money, theyd not have a problem. The problem is loans - where the parents wants to have cake and eat it. ' Mr Groves said that parents often made loans, rather than gifts, to their children, out of fear young people might abuse their wealth. He said it would prompt some families to refinance their lending and even put their property up for sale. “By making a loan you are in a worse position than if you made a gift.” ' Its like Doh! Greedy fckers trying to speculate on property nominally owned by the kids. Bit the idiot in the ar5e. Quote Link to comment Share on other sites More sharing options...
frederico Posted December 13, 2016 Share Posted December 13, 2016 I don't get it, if it's an unofficial loan, who cares, just don't bail either party out. Quote Link to comment Share on other sites More sharing options...
frederico Posted December 13, 2016 Share Posted December 13, 2016 I suppose the government might at some time question the real ownership. Quote Link to comment Share on other sites More sharing options...
One-percent Posted December 13, 2016 Share Posted December 13, 2016 1 hour ago, spyguy said: If they had gifted the money, theyd not have a problem. The problem is loans - where the parents wants to have cake and eat it. ' Mr Groves said that parents often made loans, rather than gifts, to their children, out of fear young people might abuse their wealth. He said it would prompt some families to refinance their lending and even put their property up for sale. “By making a loan you are in a worse position than if you made a gift.” ' Its like Doh! Greedy fckers trying to speculate on property nominally owned by the kids. Bit the idiot in the ar5e. Wealth? Wealth he says? That's not us proles then. but I am one percent, so I might get caught in his trap, unlike the likes of the duke of Westminster Quote Link to comment Share on other sites More sharing options...
Lovely Rum Posted December 13, 2016 Share Posted December 13, 2016 as buddy holly once said "that'll be the day!" Quote Link to comment Share on other sites More sharing options...
interestrateripoff Posted December 13, 2016 Share Posted December 13, 2016 If it's a loan that pays interest are they declaring any profit to the taxman? Quote Link to comment Share on other sites More sharing options...
spyguy Posted December 13, 2016 Share Posted December 13, 2016 34 minutes ago, interestrateripoff said: If it's a loan that pays interest are they declaring any profit to the taxman? Thats. Anyone with any sense and/or love for their kids would gift the money. Greedy halfwits with a lack of understanding of the complexity the are getting into, loan the money to their kids. See film allowance schemes for other examples of clever stuff blowing up in your face some years down the line. Quote Link to comment Share on other sites More sharing options...
Saving For a Space Ship Posted December 14, 2016 Share Posted December 14, 2016 (edited) On 13/12/2016 at 9:33 AM, spyguy said: If they had gifted the money, theyd not have a problem. The problem is loans - where the parents wants to have cake and eat it. ' Mr Groves said that parents often made loans, rather than gifts, to their children, out of fear young people might abuse their wealth. He said it would prompt some families to refinance their lending and even put their property up for sale. “By making a loan you are in a worse position than if you made a gift.” ' Its like Doh! Greedy fckers trying to speculate on property nominally owned by the kids. Bit the idiot in the ar5e. Quote Parents will hand over an average of £17,500 to their first-time buyer offspring in 2016 according to new research by Legal & General, and 57% of these contributions will be gifts rather than loans. http://www.radiotimes.com/money/news/bank-of-mum-and-dad-will-fork-out-a-whopping-5-billion-to-help-their-children-get-on-the-property-ladder-this-year/48242.html So nearly half of the parents are C**** ? http://www.legalandgeneralgroup.com/assets/portal/files/pdf_216.pdf Edited December 14, 2016 by Saving For a Space Ship Quote Link to comment Share on other sites More sharing options...
wherebee Posted December 14, 2016 Share Posted December 14, 2016 don't forget if there is more than one child, they might give it as a 'loan' to the first one so as not to upset the others. It can be more palatable than just 'my feckless brother gets another handout'. Quote Link to comment Share on other sites More sharing options...
stormymonday_2011 Posted December 14, 2016 Share Posted December 14, 2016 The FT article is about changes to the IHT treatment of loans through non domicile companies and individuals to children to buy UK property. As far as I am aware loans made within the UK by individuals to third parties be they relatives or not have always counted as part of an individual's estate for IHT purposes Quote Link to comment Share on other sites More sharing options...
Kiwi Toast Posted December 14, 2016 Share Posted December 14, 2016 I thought mortgage lenders usually required a letter confirming that these contributions to the deposit were gifts rather than loans. Quote Link to comment Share on other sites More sharing options...
Richmond Posted December 14, 2016 Share Posted December 14, 2016 What differentiates a gift from a loan. Obviously if there is a legal document saying it is a loan and you must pay back X (with or without interest) it is a loan. But what if parents 'gift' the money (and say it is a gift) but later the children start to 'repay' their parents on a monthly basis. Is this now a loan? Or is it still a gift? There is no contractual demand to repay so I guess it would still be a gift as if the children went bankrupt the parents would have no claim on their assets right? Or would the parents be able to lay claim as a creditor, making it a loan? Quote Link to comment Share on other sites More sharing options...
longtomsilver Posted December 14, 2016 Share Posted December 14, 2016 42 minutes ago, Richmond said: What differentiates a gift from a loan. Obviously if there is a legal document saying it is a loan and you must pay back X (with or without interest) it is a loan. But what if parents 'gift' the money (and say it is a gift) but later the children start to 'repay' their parents on a monthly basis. Is this now a loan? Or is it still a gift? There is no contractual demand to repay so I guess it would still be a gift as if the children went bankrupt the parents would have no claim on their assets right? Or would the parents be able to lay claim as a creditor, making it a loan? My mum gifted £100,000 each to myself and two sisters a few years back and in return I gift her £3k per annum, it's not expected but only right that I do. re. bankruptcy I expect these 'loans' will be treated as gifts under those circumstance but as loans under IHT purposes. A real lose lose situation. Quote Link to comment Share on other sites More sharing options...
Richmond Posted December 14, 2016 Share Posted December 14, 2016 (edited) 2 hours ago, longtomsilver said: My mum gifted £100,000 each to myself and two sisters a few years back and in return I gift her £3k per annum, it's not expected but only right that I do. re. bankruptcy I expect these 'loans' will be treated as gifts under those circumstance but as loans under IHT purposes. A real lose lose situation. Hmm, sounds about right! And what if you accidentally gifted more back than the £100,000 would this be seen as interest? I guess it comes down to the original intent - it must get pretty messy to pick through this sort of stuff though. Edited December 14, 2016 by Richmond Quote Link to comment Share on other sites More sharing options...
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