Your questions – Buying a house with money “donated” by parents: here’s how to avoid problems with the taxman
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We would like to donate a sum to our son to allow him to buy an apartment and to cover the expenses that the purchase brings with it. Can the amount of the donation be reasonably higher than the amount due to the seller, adding the notary’s fee and any expenses for the renovation or adaptation of the house to the needs of his family unit? If it is not possible to make the donation at the time of the sale, is it possible to implement it with a subsequent bank transfer or can this procedure create future problems with the Revenue Agency? I specify that it is our only son and, therefore, the only heir.
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The question posed by the reader is dealt with in the provision of the Consolidated Law on successions and donations, where the tax is expected (of donation, ed) it does not apply in cases of donations or other donations connected to deeds concerning the transfer or establishment of real estate rights…. The reason is simple: the deed of purchase is already taxed. As can be seen, the law does not expressly provide that the maximum ceiling for the donation of money is equal to the price to be paid to the seller. However, to avoid possible disputes with the Revenue Agency, it may be advisable to split the transfer of money from the parent to the child into two separate payments. The first, aimed at paying the price, will be accounted for in the context of the notarial deed of purchase of the house, while the sum intended for the payment of taxes, notary fees, restructuring costs and the like will be finalized separately. If it is a modest sum, the transfer may be sufficient, while if the relevant amount depends on the extent of the restructuring costs, it will be advisable to formalize the donation of money with a separate notarial deed, to avoid possible disputes for the child from part of the Revenue Agency.
With the advice of the National Council of Notaries
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