Gift of cash to buy part share of house

Gift of cash to buy part share of house

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Hi All

I'll bullet point below the outline of the question below. The benefit of someone's knowledge and experience would be gratefully received.

1. Mum & Dad own house they want to sell but this may take some time due to current housing market conditions.

2. They have identified a new build house they want to buy now that will cost £130,000 and they can raise £70k immediately.

3. Mum & Dad want to gift the £70k now (£35k each to son & daughter and their respective spouses). Son & daughter can raise the £30k each to make up the     £130k needed to buy the house (70+30+30 = £130k) and then Mum & Dad can live there rent free until death.

4. Can someone tell me if there would be any problems with 'Gift with reservation' because of the reason for the £70k gift. I imagine POAT on £70k would be relevant but this would presumably depend on future valuation and the affect on any potential benefit if valuation more than £100k.

5. The other issue is PPR which would be lost if Mum & Dad  don't own it but then again there would be 4 CGT exemptions to use.  The Gift with reservation/POAT situation is the most concerning because I don't have experience of it.

6. Mum & Dad's total current estate is only around £200k.

Thanks for any replies

Regards        

             

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