Helping son buy house

Thanks for replies.

PaddyBloggit: Students will be students I guess and my daughter would not prove too popular with her housemates if she was telling others to be careful of the place.
Another negative on Option 1 would be if my daughter didn't like her course and wanted to move to a different city. Had this already with another child of mine. Didn't like the course or Dublin so moved to Cork and loved it there.
 
Thanks Red Onion. I am slightly coming down in favour of Option 2 myself but welcome any further opinions. 200k outlay v 170k outlay. Main negative I think with Option 2 would be CGT applying to any possible increase in value over the 4 years.
 
It sounds to me from what was said previous that it would be the father's investment property if we are really being honest with the daughter as legal owner as it suits us better for tax purposes. I'm not saying Revenue would bring the case against you or that they would win. I'm just saying this is what I would think if I was in Revenue's shoes
 
Red Onion: To learned people it should be fairly obvious what I am at so no need really to ask my daughter. If what I am doing is legit why not do it ? I have put 3 other of my children through Uni with no help of student grants or student loans and my wife and I don't earn big salaries.

Dintelligentinv: Thanks for your inputs.
 
Daddy Ireland said:
Red Onion: To learned people it should be fairly obvious what I am at so no need really to ask my daughter.
Click to expand...
I understand completey, my poor attempt at sarcasm.

But on a serious note, I think you need to really think about what will happen if it all goes wrong. As in, 4 years down the road property is worth less than you buy for. Will you sell anyhow? Will daughter owe you the shortfall? There are tax implications of you saying no. Or will you keep it, potentially having tax implications for your daughter once she starts working full time?

What if your own financial circumstances change and you need the money?

If the property increases by 50k in value, is that money yours or your daughter's?
What if your daughter refuses to sell?

What if something happens to yourself and Mrs. Daddy?

I know what you're doing, and I would be doing the exact same in your circumstances (my children are far too young to be allowed to own property directly), but at the end of the day you and your daughter are entering in relatively large legal agreements, so you both need to understand the implications of what you are doing, and put an appropriate loan agreement in place between you. You never want to think family fall out, and I'm not trying to scare-monger, but it's best to have thought this through now than if it goes wrong in future.
 
Dintelligentinv said:
The first 8250 for income tax purposes would be covered by the single person tax credit. The balance of 1750 would be subject to income tax at 20%. Prsi of 4% payable on the full 10k. Shouldn't be any usc as below the threshold.
Click to expand...

The first 8,250 of rental income would be covered by the single person tax credit of 1,650. I think single people are entitled to 3,300 in tax credits. Would this then not mean that the first 16,500 would be subject to no income tax ?
 
No. I'm guessing the extra 1650 you're referring to is the employment tax credit. You're not entitled to this if no employment income
 
I see thanks for putting me right on that. So if part time employment income of say 2k and the rent of 10k then would any of the rental be subject to 20% ?
 
You can't use employment tax credit to offset the rental income. If you have 2k of employment you'd only be entitled to a reduced employment tax credit. Not the full 1650
 
You must log in or register to reply here.
Back
Top