Giving Son A Deposit For A Flat

[Budlet]

My son is buying a flat and I intend to give him a substantial amount of money - 50% - as a deposit. He will be paying a mortgage on the remaining 50%. What are the tax implications for me? Thanks in advance

[fiction-factory]

None, unless you are going to stake a claim on a a share of the property.
If you are extremely well off when you and your wife die your estate could be liable for IHT on this gift but I'm not sure if that's what you're asking about

[Old_Geezer]

As a complete non-expert I can't see why it would have any implications, just as long as you aren't charging 'pay day loan' rates for the loan. :-)

[Budlet]

Thanks for the answers. Part of the money was set aside for him when he was younger and the rest is made up of interest and savings which I have held for many years. I don't need to worry about IHT - I will leave it to him!

[fiction-factory]

I assume you mean you'll leave the problem of having to find any IHT to him. Hope you don't think I'm prying but do you have or did you have a spouse? The IHT allowance passes from the deceased to the widow/widower so the allowance is around £650000 so the estate may not fall within the band anyway

[Budlet]

fiction-factory, yes I am married. It won't fall into the IHT bracket.

[ToraToraTora]

the only issue is possible IHT if you die within 7 years.

[ubasses]

If your Estate including the money you are gifting him is below the IHT limit, there will not be any tax to pay. If including this money it would push you over the IHT threshold and you die within 7 years it will added back in when tax is calculated (on a sliding scale).
If you are lending him the money and charging interest, this would be added to your income for tax. If you are putting your name on the Deeds, you would be liable for CGT on any profit over and above the CGT allowance if/when the property is sold.

[Peter Pedant]

In giving him the money
very little tax implication other than it counts as PET ( potentially exempt transfer ) as treated by other contributors
Remember that the amount remains the amount for seven years even tho the IHT may be reduced on a sliding scale

Make sure you leave a document saying it is a gift

The mortgage company to safeguard its own money may wish to have you sign a document saying you retain no interest

Remember the additive rules on serial giving - if you give him 100k now and then 100k in three years - 2018 then the rules say you have given £200k and the clock is reset to 2018...

There are rules on reservation of benefit - giving money and then hanging onto the benefit of the moolah. This means as far as I am concerned is that you cant stay there overnight - ever ! But it may be seven years....
If you fall foul of these rules then the amount is counted as part of your estate still BUT he may even then have a capital gains tax bill too !

and good luck

I hope he is buying in London - average house prices in 2020 are gonna be £800k arent they ?