Parents want inheritance back

[NeededtoNC]

Ten years ago, my parents decided to gift me and my brother 100k each as early inheritance within the 7 year period.

With that I bought a house (with a mortgage). Still have 15 years left on the mortgage.

Now our parents want the inheritance back because they have decided they want to buy a summer home abroad.

DB is in a position to be able to as he’s well off.
However I am not and I’m barely able to keep up with the mortgage payments as it is.

In order to give back the money I’d need to sell. My parents are aware of this and have said that if I need help to pay rent, they’ll give it to me. But they want the lump sum in order to buy their holiday home.

AIBU to not give it to them?

Hmm. Bit torn on this. Part of me thinks "tell them to shove it. They can't get that money back" but then the logical (slightly mercenary!) side kicks in and thinks that if you pee them off now, you might lose out on more inheritance in the long run if they cut you out the rest of the Will.

Is there any reasoning with them or any way to work it out. You say they can't get a mortgage but they will help you with rent. Could you borrow an extra £100k against your home and they pay this part of the mortgage instead of rent?

It has to be a no. Ask them if they are really asking you to lose the necessity of a roof over your head for the luxury of a second home for them?? It’s absolutely outrageous!!

Equity release. Or if your brother is so loaded, can he purchase their second holiday home (with a mortgage or without) on their behalf and then the parents have use of it, paying him a nominal ‘rent’ to satisfy the tax man.

I would just say No

'sorry Mum and Dad, you are taking my home away from me, I do not want to go back to square one with renting. I hope you get the holiday home you want, but you gave me this gift with no strings attached. If you had said you would want the money back in ten years time, I would not have taken the gift in the first place. You cannot ask me to give up my home. I don't want to discuss it anymore'.

Also ask them why they can't rent abroad? Long term rental in Spain for instance (months at a time instead of weeks) is very cost effective

Did your parents let your DB treat you as if you didn’t exist OP?

I would say no. There is no way to recover from being turfed out of your home or deal with the idea your parents took the home of your children away because they wanted a non essential holiday home. The relationship is going to be destroyed whether you say yes or no, so just do as you please assume you are not getting more inheritances and do what is better for your own family, not your parents.

Legally speaking they Have no chance, anyway. It is all in YOUR hands.

They also don't seem to have factored in what the effects of leaving the EU will be, if/when Britain actually does it. They will only be allowed to stay for 90 days, after which they must leave for at least another ninety days. I wonder if they voted leave?

Could they do equity release on their main home? Think it is c.5% rate. Or your bro could find more of the shortfall with the expectation he will be compensated in inheritance?

Stand firm op, been there and it’s awful. Was forced to sell my own house and downsize so parents could give my sister her house deposit. She didnt buy and went on a nice holiday instead When i sold it they then asked me to ‘lend’ them the entire proceeds I’d made back to pay off their mortgage to take the pressure of them as my own house hunt was proving difficult. to this day they’ve never apologised. I refused point blank,Dad didn’t speak to me for 2 years. Bottom line is they’re being narcissistic and selfish and entitled.

The parents sound like rich entitled brats! First of all they have 200K that they can just 'gift' when relatively young.
Are you sure they were not hiding it from authorities and using you both as a 'piggy bank'?
Tell them NO! And if they continiue, remind them that you pull the strings when it comes to which care home they will go to...
That might concentrate their mind on the important stuff in life!

Agree with PP that your relationship with your parents will be irretrievably damaged whatever you do now. If you give the money back you will just resent them and it will eat away at the relationship. If you don't, they may fall out with you.

The only thing that can survive this sorry state of affairs is your current home IF you stick to your guns and don't give in. Otherwise you may lose both your home and your relationship with your parents.

Do you have a history of giving in to their demands? What usually happens when you say 'no' to them?

I'm sorry your parents are being crazy. Say No, and mean it, and don't feel guilty. I wish I'd stood up to my parents rather than letting them get away with treating me like a second class citizen. You have to look after yourself here - God knows that's what they are doing!

Firstly, it isn't their money to "get back". They gave it to you and it became your money. They are now asking you for your money but you cannot afford to it. Say no and stand firm.

It’s all very well saying you’ll get it back later but you might not if either/both of them needs to go into a care home. I think TABU. Keep the money.

Why doesn't super up himself DB give them £200k? If he can afford it and "he'll get it back anyway" surely he's important enough to do so.

It would be a firm no from me op. Maybe put the house on the market with a stupidly over the top asking price by about £100k.

Nope. Moneys gone. They haven’t even offered to pay fees so you will literally be out of pocket for their gift 😮😮. As for their ‘rent from their house’ I highly doubt they will magically be able to rent it the exact periods they are away- it would be oh sorry darling no ones renting it this week so we don’t have funds, what’s that you can’t pay your rent? What do you expect us to do?

There’ll be no inheritance likely as not. Suggest to them dbro lend them the extra against future inheritance, happy for you to balance it out then mum but I can’t aftord to sell my home, cover fees and have nothing to show for the past ten years because I accepted a gift from my parents believing in their goodwill.

If you don't want to say an outright no you could put your house on the market for a very high price, well over estate agent valuations, and then sit back. Obviously it won't sell and it would give your parents time to think/change their mind about a holiday home they cannot really afford.

OP haven't had time to read the whole thread but I'm incredulous atyour parents attitude.Years ago we gifted each of our DCs some money - a fraction of the amount you received - when a policy matured.We told each of them when it was gone it was gone as we don't have big savings,but to use it as they saw fit.They all used it as part of a deposit for their first home,saving the rest themselves.
They are all better off than us now,as health problems have meant DH can't to continue what he was doing work wise, and due to the delay in pension age I've a way to go in that regard.No way would we ask for that money back.Especially for a holiday home.We have a nice home already and whilst not able to jaunt off like some of our friends count our blessings,and value the loving relationship with our DCs .They help us out in many other practical ways,as do we them.I have never regretted our decision to gift that amount,and I'm sorry your parents have put you in this position.I would simply say no, you can't and won't lose your home.DB can refund if he wants to .That's still a big chunk of money back for what is essentially a luxury.

How about this?

You remortgage your house, and purchase a share of their holiday home, with a ring fenced time for your holidays plus a minimum guaranteed rent income?

I'm so sorry for you to be in this position OP. I hope you stay strong and don't give in on this, despite any outrageous guilt trips they try to lay on you.

There are a few things to consider here, one, they are not being truthful when they say you'll get the money in the ned anyway. Who know s what they're estate will be like by the time the pass. Health care and elder care costs, poor financial choices, the costs of enjoying retirement will all eat into whatever assets they think they will have - and that's completely fine, their money they should do what they like with it BUT the gift they gave you is NOT their money and hasn't been since they gifted it to you.

Secondly, I find it hard to believe that they must have 200k to buy a holiday home. If they really want to do this they can get more creative, perhaps your DB can invest in a home then he could stand to inherit the whole holiday home? Perhaps they could look at timeshares (if those are still a thing these days?) or even just add up the costs of renting a place a few times a year and see how many trips 100k would cover (i'm guessing that would buy years of holiday rentals).

Whatever you do OP, don't let people who will happily turn your life upside down and place you in a precarious financial position over money they have no rights over, make you feel selfish in any way! I imagine your family relationships are going to suffer quite a bot but this is not your doing.

your brother and parents share the same narcissistic trait....back away from them all and say NO for your own sanity...be the same as them THINK OF YOURSELF!!

They're being massively unreasonable. Do not give them any money. Horrible thing to do, attempting to effectively force you to sell your home. Nasty.

Ten years ago, my parents decided to gift me and my brother 100k each as early inheritance within the 7 year period.

It was not an 'early inheritance', it was a gift.

Inheritance tax is not charged on gifts that fall outside the 7 year limit because they no longer form part of the estate.

If you give somebody money to avoid inheritance tax but still expect to benefit from it, that is just tax evasion.

Oh god OP. I’m so sorry. I have no advice, but the whole situation stinks.

From moneywise.co.uk:

It is possible to gift amounts in excess of the tax free exemptions, as you are looking to do. These are known as Potentially Exempt Transfers (PET). For these gifts to be free of inheritance tax you need to survive for seven years after making the gift. You can give away most assets, including cash and shares. However, it has to be an outright gift from which you can no longer benefit

Therefore, in order for them to legally give you the money in the first place, it had to be a gift from which they can no longer benefit.

Just tell them no. They offered a gift, and you accepted a gift, and it has to remain that way. No-one needs a holiday home.

And if (obviously tragically) you or your brother return the money and die in less than 7 years, you will have given your parents a gift that could become liable to inheritance tax.