DISCUSSIONS

Find the answers to many of your expat questions here

View Latest Posts

You're missing out...

As a member you can enjoy exclusive info and offers.

REGISTER NOW

Loan implications

Posted by Tourville - Created: 4 years ago
0 0
Sorry no image available

10 replies (Showing replies: 1 to 10)

Sorry no image available
Posted by JohnnyVegas - 3 years ago

Wow don't over complicate it!

let your son sell the house, pay no tax as no profit, money in his bank.

Then he pays you back, simple.

you gave him the money in the first place without any complication so it's just the same.

stop worrying as others have said.

Sorry no image available
Posted by jez-de-belon - 4 years ago

Not sure of the exact details, but in the absence of a loan agreement I think it is best to consider this as two gifts; one from you to them and one from them to you.  If these were made in the UK (the second will be, but I'm not sure about the first) then there is a potential inheritance tax liability.

However, I see no reason why you could not treat them as Potentially Exempt Transfers.  Essentially this means that as long as the giver lives for seven years after the gift then there is no tax to pay.

Sorry no image available
Posted by chemin vert - 4 years ago

The paper trail will be easy to follow through bank statements. Don't look for problems that don't exist.

Sorry no image available
Posted by Grossac - 4 years ago

The notaire is there to give you advice on the tax implications in France   If there is no profit I cant see what could be taxed in the UK or France 

 

Sorry no image available
Posted by Kanak - 4 years ago

Hi Tourville..... it sounds as though the house was bought in your son's and wife's  name.   The question seems to be whether at the time of purchase there was any record that the purchase had been funded by you rather than them.   As there is no profit, tax does not seem to be an issue.  The notaire is right in saying he can only settle with the owners.   Since they presumably will have documentary evidence of the sale, there should be no problem transferring the funds once in the U.K., as this is quite clearly not money-laundering.  Pushkin's post does not help, as you describe this as a loan, not a gift.  The problem in France is that a loan is repayable, (normally with interest), while a gift is for life, and not returnable. Telling the notaire at this stage could complicate things by having him ask about the conditions of the interests paid on the loan, so my instincts would be to let the sale go through untramelled, and sort out your affairs in the U.K. privately.  I am, however, not a notaire myself, and you may still need to check with your solicitor or banker in the U.K.

Sorry no image available
Posted by buster-784461 - 4 years ago

When selling a house in france the notaire will/should give an attestation of the money recieved in the sale!

It will be in your sons name - so he can show this if the bank queries where ithe money  came from!

So if the money is transfered to you hold on to the document - 

You must have a paper trail to show you gave the money to your son in the first place -  so this shows its been returned!

 

Sorry no image available
Posted by sophie hunton - 4 years ago

Legally you have to have a paper trail to prove the true ownership of all monies,the problem won't be in France it will be in the uk when the money is transfered into your sons account and then transfered into your account as you may need proof as to its origins.

Sorry no image available
Posted by countrydweller - 4 years ago

And as it is "real property" any tax has to be paid in France not the UK so as you have made a loss in FRance there is no cgt to pay.The sun is out put a bottle of rosé in the fridge stoke up the BBQ and RELAX

Sorry no image available
Posted by Pushkin-986745 - 4 years ago

You can legally give 100,000€ to each child in a 15 year period tax free .. so no problem .

 

Sorry no image available
Posted by chemin vert - 4 years ago

I have lent my sister a substantial amount of money recently. The banks would give me so little interest on it I'd rather it helped her. being allowed to help your family is still allowed in this increasingly complex world.