I'm buying a new house with my wife. My parents are giving us a considerable amount of the purchase price, although we still need a mortgage. Am I liable for any tax, since their gift is a gift with no strings attached? If I am - is there a calculation so I can work out how much I'm liable for?
Thanks.
You are not, directly - but there could be IHT implications for your parents.
In message , Doug Ramage writes
And for him if the gift takes their PETs over the Nil Rate Band and they kick the bucket with seven years etc., 'cos the tax on the PET might fall on him.
Am I right in thinking that because the figure is nowhere near 250k that I don't need to worry about it?
Yes, you probably are. Strictly, it depends on whether they have made other substantial gifts before yours, within the relevant 7 year period. If they had, it could be that your gift is partly or wholly outside the NRB, in which case tax in respect thereof could be clawed back.
Also, if it was a joint gift from *both* parents, then it'll be *two* NRBs added together which apply.
Not quite. You might still need to worry about it if your parents have already made otehr gifts before making yours - these will use up the Nil Band first should they die within 7 years of making them.
And remember the 'taper' applies to the tax not the gift so it doesn't help you.
Robert
In message , nospam writes
So long as the total of all PETs in the seven years prior to death is less than £263k (at the moment) then you are ok.
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