Tax ?
 

Hi Guys, wonder if anyone could tell me , what would be the maximum amount of money I could give my son and daughter in law for part payment of a house, before the amount was taxed if any.

Re: Tax ?
 

JonBoyE is the local expert, but I don't think gifts to your children are taxable (on your side). Nor are they tax deductible.

Re: Tax ?
 

That's right. There is no tax on gifts.

The only thing to watch out for is if they are minors. Then any income they earn from the gift will be attributed back to the giver (the so-called kiddie tax).

Re: Tax ?
 

Thanks guys, Jonboy would you know if My son and his wife would get taxed ? we are planning to put the deposit down on a house as our share and live in the inlaw suite , and then be morgage/rent free. Thanks for any info.

Re: Tax ?
 

On the basis they're working and/or have room in their respective RRSP and that its a first time buy ... consider the gift of the money & let them max on unused RRSP.

That should get them some money back on the taxable income, added to what you're giving them = a greater down payment, after they withdraw the RRSP tax free for the house purchase

Of course they'd need over time to pay back the withdrawal from the RRSP

http://www.cra-arc.gc.ca/tx/ndvdls/t...-reer/hbp-rap/

Maybe jonboy could explain it better than what I've done

Re: Tax ?
 

Capital transfers in Canada are not subject to any form of tax, because there is no estate tax, so there's nothing like gift tax in the UK. It doesn't sound as though you want to have any title to the house, so there's no issue really. If you had joint ownership there are some things that might come up. You need to be clear on who owns the house and what will happen if something happened to your son and his wife for example.

I'm not sure where you live but each Province has different laws governing who is entitled to what so your wills all need to be very clear.

For example say your son and his wife are killed in an accident, their children get the house, not you.

The law is not obvious, e.g.: https://en.wikipedia.org/wiki/Adult_...hip_in_Alberta

Re: Tax ?
 

good points there Steve, especially if there is a disagreement while Mum & Dad are living with the children as lodgers so to speak.

What if the children split up - divorce, or one of them dies or when one of the parents living with the kids die or perhaps the parents don't like Canada & want to move somewhere else or back home. You need an escape clause or exit strategy. You need a contractual arrangement IMO - not just 'heres the money, we love you' & trust they'll continue to honour the arrangement

Re: Tax ?
 

Thanks everyone, some good points to think about.

Re: Tax ?
 

One more thing for you & your husband to think about Deb

Depending on the amount of money you give the children relative to the percentage cost of the property, you could put the house ownership in all four names.

Set up a power of attorney & a succession agreement as well as a will where in the event one, both all or die the share of the house is divided equally among the survivors.

Also you need to consider an escape clause whereby should anyone want out the remaining owners have the option to buy the share of the ownership or the property will be sold & divided as agreed in percentages

Re: Tax ?
 

Have any of you living in Canada house shared with you married grown up children - if so, is/was it a positive or negative experience?