M, 35, is buying a house for £1.04M (with a mortgage of £432k). To facilitate this his mother S, 69, is proposing to gift M. £100k, and lend him a further £300k to be repaid from the eventual sale of his current flat.
Question 1: how does the gift need to be recorded so that the 7 year clock for a PET starts to run?
Question 2: does the loan need to be documented in any particular way to satisfy either HMRC or the mortgage provider? Are there any other likely problems?
Many thanks.
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