So annoyed with one son

Bluebelle, my house is worth about £250,000 plus I have some premium bonds etc which MAY take it to the £325000

In which case crazyH you are essentially worrying about nothing. Inheritance tax is paid on the part of the estate that exceeds £325,000. so let us say yours pans out at £335,000. You would pay Inheritance tax only on the £10,000 which would cost £4,000. On that much money is all the hassle and muddle you have got yourself into worth it?

If it is a loan, it will be counted in as part of your estate anyway, so loaning the money achieves nothing.

I am beginning to feel that you have chosen to run headlong into a muddle without taking thought or proper advice and in effect you have ' "sown the wind, and shall reap the whirlwind" and only yourself to blame.

As I understand it, you can give your children as much money as you like in one tax year. If you die within seven years, tax is due on it. If you live longer than seven years, no tax is due. Nothing has to be declared. crazyH has done nothing wrong or underhand.
When we gave our daughter a lump sum as a wedding present, an accountant advised us to put it in writing what we had done and my husband, daughter and I signed and dated it. The accountant kept it in case husband or I died within the seven years to prove the date of the gift.

You are all adrift here CrazyH. The inheritance tax allowance is £325,000 for a single person plus an additional £125,00 on the value of your home making no it a total £450,000 before you have to pay that particular tax.

Inheritance tax will only be due on it if it means the total of the estate exceeds the IT limit.
(See Monica's post)
Lump sums for a DC wedding are allowed besides the £3,000 pa gift allowance.

And Eglantine's post

I really am adrift.....Eglantine says the threshold is £450000....oh I am confused now

I'm guessing that the son who isn't repaying is also the one whose need for more space promoted you to give your son's £20k each!

prompted, not promoted!

Spot on Elrel !

crazyH please get yourself a wee appointment with a financial advisor.

The tax issues here are complicated amd it also looks like you are not certain of how much all your assets and investments are worth.

Plus you are comcerned about an ongoing income.

Get all your documentation together and see an IFA. Not that expensive for a couple of appointments and likely to put you on a much better financial footing.

The most important thing crazyH is that you are not short of money now to enable you to have an enjoyable retirement, doing what you want ie nice holidays maybe, and meals out with friends.

I would echo what has been said - get proper legal advice, and do something about that greedy son too!

As your other two are paying the money back, I think you should certainly amend your will, stating that the amount that has not been paid back upon your demise is to be deducted from each child's inheritance. This way they all, eventually, in what I hope is the dim and distant future end up treated equally. And that was your intention, obviously.

If you need the money to have a comfortable retirement you should have used that £60k to fund it, anyone would be lucky to inherit £325k as and when, I have never been left a penny but it has never bothered me. I really don't think that you should be worrying about any money you have at your age. I don't believe in loans, I would always give what I could but not loan.

You can look up the rules about inheritance tax on gov.uk where it is explained clearly.

If anybody ever sees Judge Judy? She ALWAYS says NEVER lend money to family. If you can't afford to GIVE it then don't because lending is tricky and causes untold fall outs with family.

IF they chose to pay you back, great. If they don't, you are then in for one heck of a complicated scenario. You will fall out with your son and their siblings will also when they find out he is not paying as agreed. Assuming they all get on now - do you want that?

Obviously I have no knowledge of the relationships between you and all the children so ...just saying.....

Bluegal I watched Judge Judy a few times and she makes me laugh with her pithy comments about her own children...I believe she has 4 or more. She won’t even act as a guarantor for them!

When you write your will can't you just make it clear he get 20000 less than the other two if he hasn't paid any money back to you by the time the will is activated??

Update: yesterday we had a family celebration and all hell broke loose / it started with me getting my granddaughters gcse grades wrong / this same annoying son then started off on me saying you (me) always get the wrong end of the stick etc etc From there it went on to a verbal attack / about me favouring my younger son and daughter etc etc (the said younger son and daughter had already left) . The attack was so bad I couldn’t sleep at all / I am on my own and so this morning I rang my daughter and my younger d.il to tell them about last evening / my daughter of course rang them and all hell broke loose again / this same annoying son then texted me to say he wants nothing more to do with me and that I should not contact him again. He is blaming me for all that happened, How sad / start of a total estrangement / his wife must be rubbing her hands in glee / she never wanted to be part of our family xx

Well of course he wants nothing to do with you, he owes you twenty grand he doesn’t want to pay back. This is a convenient excuse for him.

I still encourage you to see a financial advisor, and possibly a lawyer about your will. You will never see that twenty grand again.

It sounds as though if he wants nothing to do with you, I should see a solicitor, and amend your will by not mentioning him in it. Then he won't be disappointed will he?

Yes, you are all quite right / very convenient way of not paying his debt / I will be changing my will for sure/ he’s not going to get away with not paying back his debt / So if I am not good enough for them they can return MY money

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I’m sure you did this with the best of intentions to help all your children but I think I would have a conversation with him saying that it is important to you financially that he makes regular repayments like his two siblings. I would say that if he is unable to do this he must say so and you will add a codicil to your will that in fairness two your other two children the amount he was given should be deducted from any inheritance he receives. If this is done in a non-confrontational, matter of fact way it shouldn’t harm your relationship. What Flexiblefriend has said about the interest is a very good point and should also be applied to the debt.

Sorry I didn’t read you latest post before I posted the above. What a shame that it has ended this way and obviously the non-confrontational conversation I suggested no longer applies. I’m sad for you that a family celebration ended this way.