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Original poster

School Fees and Grandparents Paying them

94 replies

Whoooosh · 22/03/2007 16:36

Am about to pluck up courage to ask my father to pay dd's school fees.
My three sisters all had private and public school education whereas I went through the state system.

I would dearly love to send dd to a private school but realistically knwo it will be a huge struggle.

I hate asking anyone for anything and I know the money won't really make a huge difference to him but I just wondered if there were any tax advantages for Grandparents paying school fees.

It's not that I want to sweeten him up-just want to show him I have done my homework-and where better than MN?

OP posts:
Hulababy · 22/03/2007 16:40

There are and DH does recommend such things to grandparents as part of their overall tax and trust planning. Think a lot depends on their financial situation, ages, etc. I can have a word with him later when he gets home and see what he says.

Hulababy · 22/03/2007 16:43

They are financial incentives (not necessarily tax breaks) - just to clarify!

Original poster
Whoooosh · 22/03/2007 16:45

Ooooh thank you Hula-I would be really grateful.

OP posts:
Lilymaid · 22/03/2007 16:48

"If you have parents who are willing and able to pay for their grandchildren?s school fees, this is an extremely tax-efficient option. It allows grandparents to move money out of their estate, so reducing their potential inheritance tax liability. Grandparents can also set up a trust on behalf on their grandchildren into which they pay the proceeds from investments. This will allow them to use both their grandchildren?s capital gains tax allowance and personal income tax allowance."

Hulababy · 22/03/2007 16:54

No worries; have e-mailed him query but will probably be later this evening when he gets home that I get to post his reply.

Think LilyMaid's reference is type of thing he will say, but maybe more details.

Original poster
Whoooosh · 22/03/2007 16:55

Oh thank you-this is just the sort of info I need.
There was a trust set up with regards his house for when he and his wife died but apparently owing to Gordon Brown this has had to be disbanded (really don't understand this stuff) so anything which keeps his money out of Gordon't clutches will help.

Thank you.

OP posts:
RTKangaMummy · 22/03/2007 17:05

how old is DD ?

and how long until\ she will be going

cos there are some schemes that you pay LESS money in and school invests it for the child iyswim

Original poster
Whoooosh · 22/03/2007 17:11

She will be 2 next month so nursery at the school will start in Sept 08 and take her till 13-and that is when the serious costs kick in I guess.....

OP posts:
RTKangaMummy · 22/03/2007 17:16

so they could invest now for 13+

make sure the fees can be transferred to different schools and it will give you security for future

RTKangaMummy · 22/03/2007 17:18

read this it deffo brill for grandpareny#ts

RTKangaMummy · 22/03/2007 17:20

\link{http://www.sfia.co.ukand read about this one}

or put SCHOOL FEES INTO GOOGLE

RTKangaMummy · 22/03/2007 17:22

and read about this one

snorkle · 22/03/2007 18:11

Message withdrawn

Judy1234 · 22/03/2007 18:13

The basic saving is if you give money away and live 7 years you don't pay inheritance tax and you can also give aside from that small gifts each year too. If he doesn't want to give it away then that's not going to persuade him. If he were planning to start giving it to you and your 3 sisters anyway then this is another way to give it. If he wants to spend it all on himself before he dies then it won't persuade him but if you missed out as a child it sounds like a good moral argument that he should make up for that now.

amidaiwish · 22/03/2007 19:27

my friend is a teacher in a private school in surrey. apparently 70% of school fees are paid for by grandparents in that school...

i did tell my dad

Original poster
Whoooosh · 22/03/2007 19:50

I don't disagree snorkel but by giving the other three the education he chose for them-they have met the "right people" [barf emoticon] who no doubt they will marry and will well afford private education for their progeny.
If truth be known-he could probably afford it for all but my problem is I have never asked him for a penny since I was 18 (and they all have/still do)but so feel slightly bitter that I didn't have the start they had,he could in some way make it up by paying dd's school fees.

This could be a whole new thread I guess but I just want pure facts for when I meet him on Sunday.

OP posts:
snorkle · 22/03/2007 20:21

Message withdrawn

Hulababy · 22/03/2007 20:43

If he has large estate and wants to reduce his IHT liability. He needs to make gifts out of his income, rather than capital, and then there are tax benefits to him in doing this. The 7 year rule doesn't apply if it comes out of regular income and doesn't affect his standard of living.

So no tax benefit as such; it's just a way of your father getting rid of money in order to reduce his IHT liability later on.

Judy1234 · 22/03/2007 21:26

True and if it's too high to be out of income then the IHT 7 year stuff is relevant.

Interesting issue on the effect life long on the one daughter who didn't get the private education and how the 3 other sisters compare? Did it make a different to their incomes, careers, A levels and men they married or not really?

RTKangaMummy · 22/03/2007 21:44

Xenia why do you have to make every thread have the same topic

schools v marriage v ££££££££££££

????????

Judy1234 · 23/03/2007 11:24

It's a thread about grandparents paying for school fees. It was hardly my influence that led it on to that topic. It started on that basis. but observing that example of what effect it had on one child to be state educated compared with 3 sisters who were is surely very interesting particularly for parents having to decide whether to pay or not.

Anna8888 · 23/03/2007 11:46

Xenia - yes, it's an interesting issue.

My father's parents had five children: boy, boy, girl, girl, boy, over 20 years. They hadn't reckoned on child no 5 (born when my grandmother was 45 and my grandfather 60) but because he was a boy, they decided to take daughter no 2 out of private school and put her in a grammar school in order to pay for private (boarding) school for boy no 3. All the other children went to boarding school right through from age 5/6 (it was the war and they were in India) to 18.

Of course, my aunt has never forgiven her parents for this, more particularly because she is very clever and because her younger brother has gone on to have a spectacular career, make loads of money and has four children whereas she married a divorcé academic rather late in life and never had children or a proper career of her own.

Anna8888 · 23/03/2007 11:49

One other point - my paternal grandmother got a Cambridge 1st, so I find it even more shocking that she went along with this plan that deprived her 2nd daughter of a university education.

Judy1234 · 23/03/2007 11:55

It was a cultural norm to prefer boys and their education over girls because girls were just going to be housewives so what's the point I suppose.

Arugably any mumnetter who chooses to be a housewife is helping to perpetuate that too.

redsky · 23/03/2007 11:56

my son told me a few years ago that in his prep school class of 15 boys, 12 of them had fees paid by grandparents. He thought we paid his - which we do, but only because we have inherited money from his grandparents!