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Right this is a bit tricky - essentially i am owed 20k equity from my house. Me and my ex have split up obviously!!
She is staying in the house and giving me the cash - we were NOT married
she is planning on giving me £10K a year for 2 years in installments of £5k
where do i stand on tax? inheritance/capital gains?? Any ideas??
As long as she doesn't die in the next 7 years you're fine. You're not planning a new patio?
not sure this is true as she is basically paying him the equity from the house, so almost paying back a loan ?As long as she doesn't die in the next 7 years you're fine
Poss speak to an accountant ?
You didn't say whether this £20k was due to an increase in value of the house or merely the capital you originally invested.
Can I just say that you must be very trusting too.
20k is the equity invested - why trusting?
It's all above board - solicitors etc to sort payment schedule
Ask her to move out, it will not end well.
she lives there with my daughter
why trusting?
What's to stop your ex if she decides that she doesn't want to pay you back anymore?
You are fine. No tax required as it was only the money you'd already invested in the property.
everyone - surely the solicitors letter/payment schedule is legally binding? also i am paying her £x/month for our daughter so if she doesn't pay then neither do i
also i am paying her £x/month for our daughter so if she doesn't pay then neither do i
The difference is if you dont pay your child maintenance you could end up doing time at her majestys service.
both are money owed 🙂
Get the agreement secured on the house as a charge, then she will be unable to sell without paying you and if she defaults you may be able to force the house to be sold to repay you. IANAL
can I just say I've always liked you iamanobody, defo my favourite forum member.
iamanobody - Memberalso i am paying her £x/month for our daughter so if she doesn't pay then neither do i
For the love of god, won't somebody get this man some legal advice.
It was your primary residence so capital gains doesn't come into it, nor inheritance. Your ex is buying you out for £20,000. I would have this written up at which point she owes you the £20k creating a loan from you to her. The £5000 payments per year are then payments against the loan. The payment schedule should also form part of the agreement so it doesn't become a 20 year loan.
It wouldn't cost a great deal to have a solicitor write up the agreement and save you a lot of time and money if things do not got smoothly later down the line.
also i am paying her £x/month for our daughter so if she doesn't pay then neither do i
Keep these separate too. Your payment to your daughter has nothing to do with you receiving the £20k. Otherwise your ex could just turn round and say forget the £20k I've offset it against future payments to your daughter.
[i]For the love of god, won't somebody get this man some legal advice.[/i]
Not all women are money-grabbers. And some fathers want the best for their children. Coming to an agreement with the ex can work.
The OP was asking for tax advice, not how he should sort out the agreement with his ex.
Wouldn't you be better off getting her to "take" maintenance payments from what she owes you? That way you're not paying from your wages after tax & NI, so it becomes more tax efficient for you (and if you're going to apply for a new mortgage/loan etc your net pay will be higher temporarily).
I'd go see someone who knows something.
thats what i thought