Can you receive money as a gift, and will there be tax charged?
Q.
My parents have recently retired and sold the family farm. They
are interested in paying off my $300,000 mortgage and then have us
pay them $800 per week until the money is paid back. We plan to
live in the house for the next 10 years or so. My understanding is
we can receive the money as a gift but will there be any tax
charged on our repayments to them?
A.
Provided the loan is interest free, there are no tax
implications for either party, but if your parents charge interest,
it will be taxable income to them but will not be deductible to
you.
Each week financial advisor Noel Whittaker answers your
questions.
