BEST FRIEND GIFT

[mansoor]

Hello experts,

One of my best friend from non EU country want to help me (GIFT) with sum £25K deposit towards buying a flat

!, Do i need to pay any tax

2, property conveyancing solicitor asking for extensive proof of deposit i show my bank statement still not satisfied

3, which kind of supporting documents do i need from my friend to satisfied conveyancing solicitors

any possibility to save my deposit which already i paid 10% initial amount towards flat

Thanks

[AGoodman]

1. No
2. / 3. I don't understand.

Why is your solicitor asking for evidence of you having money? - are they looking to obtain evidence of source of funds - ie that you obtained the money honestly?

The solicitors act for you. Ask them what documents they want and why.

[maths]

As is the case with many professional advisors and banks in my experience they are apt to interpret and extend what are the actual legislative provisions (eg re money laundering) and demand information or compliance with their own internal rules and guidance whether or not these are in fact what the legislation states. They are simply concerned to protect their own backs.

Increasingly for normal residential property purchases solicitors request identification of source of funds and proof of origin taking no account of the risk profile of the purchaser and simply operate a blanket policy of demanding information irrespective.

Failure to supply this information/proof typically causes the solicitor to refuse to act whether reasonable or not.

[Lee Young]

If there is a mortgage then the solicitor will also be acting for the mortgage company and therefore has a duty to them also. The solicitor will need to establish (for the purposes of complying with the Anti Money Laundering Regulations) the source of funds, and also, if there is a mortgage, that there will be no one else who might have an interest in the property other than you the buyer and the mortgage company, though its mortgage.

[AnthonyR]

From a practical point of view, your friend may need to get a solicitor/accountant to confirm the source of income (ie earning/savings/disposal of asset). As mentioned above, it's simply to ensure that this isn't the proceeds of drug dealing/people trafficking or some other illegal activity.