Postby tax_schmax » Tue Jul 24, 2012 9:20 am
In life, you can seldom have your cake and eat it too. Your father wants to give you money to spend on homes, yet keep the income from it. If you give something away and retain a benefit from it, it is generally know as "a gift with reservation of benefit". i.e. not a gift at all. Another way to look at it would be that your father is deliberately depriving himself of capital necessary for his maintenance and survival. He has the money he needs to survive, if he gives it away, he will suffer. It seems like he needs the funds more than you or your sister. If for any reason you could not repay the loan, severe hardship could be forced upon your father.
My suggestion for you is this; has your father considered if restructuring his assets would generate more income, thus freeing up capital to make a lifetime gift to you and your sister? Rental properties and investment plans are two options. You should see a financial planner with your father. You can discuss maximising his income from a smaller pot of money, allowing the residual to be given to you and your sister in a simpler way.