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taxadvisor.uk, Chartered Certified Accountant
Category: Tax
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Experience:  FCCA - over 35 years experience as a qualified accountant (UK based Practitioner)
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Are there any tax implications of having a legal charge over

Resolved Question:

Are there any tax implications of having a legal charge over my son's property?
Submitted: 3 years ago.
Category: Tax
Expert:  taxadvisor.uk replied 3 years ago.

Hello and welcome to the site. Thank you for your question.

There should be no tax implications of having a legal charge over your son's property. I presume it is to protect some sort of funds you would be advancing to him.

If you are charging him any interest on that loan then the interest you receive would be chargeable to income tax. If the money advanced is free of interest, then there are no tax implications at all.

I hope this is helpful and answers your question.


If you have any other questions, please ask me before you rate my service – I’ll be happy to respond.

Customer: replied 3 years ago.
Thank you for your prompt response. I gifted £200, 000 to my son over 10 years ago (which is no longer subject to Inheritance tax) and I now wish to protect my interests in the event that he decides to sell the property, without me or my estate incurring any tax liability. I do not intend to charge him interest. Please confirm that your previous response still stands. Many thanks.
Expert:  taxadvisor.uk replied 3 years ago.
Edward, thank you for your reply.

In your own words, it was a gift to him given some 10 years ago.

I presume you have some documentation confirming this gift. In the event you don't have any documentation on hand, it would be advisable to have some form of declaration signed by both parties stating the amount gifted and the date it was gifted. Also a copy of bank statement showing transfer etc would be helpful. If it was used to purchase a property, the completion statement would show source of capital (hopefully).

This should suffice.

I hope this is helpful.
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Expert:  taxadvisor.uk replied 3 years ago.
I thank you for accepting my answer.

Best wishes.

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