How JustAnswer Works:
  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site. Ask follow up questions if you need to.
  • Go back-and-forth until satisfied
    Rate the answer you receive.
By continuing to use this site you consent to the use of cookies on your device as described in our cookie policy unless you have disabled them.
Ask bigduckontax Your Own Question
bigduckontax
bigduckontax, Accountant
Category: Tax
Satisfied Customers: 8799
Experience:  FCCA FCMA CGMA ACIS
75394688
Type Your Tax Question Here...
bigduckontax is online now

My sister and I are planning to buy my parents house from

This answer was rated:
★ ★ ★ ★ ★

Hi my sister and I are planning to buy my parents house from them as they want to gift to us but they still have outstanding £200k left on equity. So we plan to buy from them then they will gift the amount they receive from the sale of house which would be around £600k. Would we get taxed on this money? Would it even be allowed to gift this amount?

Hello, I am one of the experts on Jut Answer and pleased to be able to help you with yur question.

The UK has no Gifts Tax Regime so a gift would come to you tax free. Just thank your lucky stars you don't live in France where the tax kicks in at 70% over 5k Euros!

The gift would create a Potentially Exempt Transfer (PET) in their Inheritance Tax (IHT) affairs. PETs run off at a taper over 7 years and in the event of a decease within this period would be added back to the estate for the IHT computation. PETs are the first to suffr IHT and if the estate is insufficient to meet the tax on the PET than the liability cascades down to the beneficiary for immediate payment. The classic defence against a PET is a reducing term life insurance policy.

bigduckontax and other Tax Specialists are ready to help you
Ask your own question now
Customer: replied 9 months ago.
Thank you so much for your reply was very helpful

Thank you for your support.

Ask Your Own Tax Question