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Bank of Mum and Dad: Considerations when helping your children with a property purchase
An increasing amount of young people are relying on the ‘bank of mum and dad’ to purchase their first home. According to a recent Savills report, 52% of first time buyers received help from their parents in 2024. This trend is expected to continue and parents should consider a number of factors in supporting their children in this way.
The support may be by way of:
- A financial gift
- A loan
- An assignment of contract to buy a property off-plan
Financial Gift
Most importantly parents must decide whether to make a gift or a loan. A gift is the transfer of money without any expectation of repayment nor any interest in or control over the property.
If the child is intending to use a mortgage, a gift may be the only option since many mortgage lenders will not proceed with loaned funds. It is sensible to speak to a mortgage broker on this point at an early stage. Where a mortgage is involved parents will need to sign a declaration of gift in the mortgage lender’s required format.
Parents should consider ways in which they may protect their gift for the family, for example, should the child later be in divorce proceedings, or errantly sell the property. If a parent is a co-owner this will increase the Stamp Duty Land Tax payable for second property ownership. Parents may wish to consider requiring the child to enter a restriction on the title requiring their consent to sell, which imposes an administrative hurdle (although no concrete protection); or mooting prenuptial agreements.
There are tax implications. If a parent were to die within 7 years of the gift then it may be subject to inheritance tax. Gifts of up to £3,000 are exempt from inheritance tax and the allowance can be carried forward for one year, making a potential £6000 available.
Loan
A loan structure can be used to give the parents more control, and this can be supported by a legal charge (a mortgage) over the property in favour of the parents, subject to the agreement of any principal mortgage lender. The parties are free agree the detail of the loan terms, whether any interest is payable and whether it may be waived in the future.
A formal loan agreement should be put into place but this need not be complex. If parents decide to charge interest on the loan, the income will be subject to tax. If the gifting parent were to die, the amount of the loan would remain within their estate for inheritance tax purposes.
Assignment of Contracts
Parents may purchase an off-plan property and closer to completion of the construction choose to assign/transfer the benefit of their contract (and the paid deposit) to their child. They may ultimately gift the balance or the child may obtain a mortgage for the amount payable at completion. In the latter case, parents and children should be aware that some mortgage lenders are reluctant to lend in cases of ‘assigned contracts’. If the property has gone up in value since the date of contract potentially capital gains tax could be payable and specialist advice should be sought. Similarly, the tax implications of gifting the deposit would apply, as set out earlier. If there have been changes in Stamp Duty Land Tax between the date of the contract and the date of the transfer then those changes may apply to the contract. Legal advice should be sought on this point on a case by case basis.
Conclusion
Whichever way parents choose to support a home purchase it is evidently important to seek comprehensive and joined up advice. Quastels offers specialist real estate and tax advice with access to a network of trusted advisers. Contact: enquiries@quastels.com
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The EU Deforestation Regulation (EUDR): A New Era for Supply Chains – Is Your Business Ready?
The EU Deforestation-Free Regulation (EUDR) will reshape global trade. It aims to curb deforestation and forest degradation linked to EU consumption.
The EUDR applies to both EU and non-EU companies and covers products placed on the EU market or exported from it. Companies placing certain commodities or products on the EU market will need to prove they are deforestation-free – or face significant compliance risks.
The EUDR came into force on 29 June 2023 and its obligations are applied in phases with large and medium companies subject to the Regulation from 30 December 2025 and small and micro companies subject to compliance from 30 June 2026.
Who’s Affected?
The EUDR applies to seven key commodities – cattle, cocoa, coffee, palm oil, rubber, soy, and wood – plus a wide range of derived products like leather, chocolate, furniture, cosmetics, and printed goods.
Even businesses not directly trading these goods – from banks to hospitality providers to construction firms – will be affected as stakeholders demand deforestation-free sourcing.
Compliance
Companies must conduct due diligence, including providing geolocation data for their supply chains and submit a mandatory Due Diligence Statement (DDS) to an EU database.
But this isn’t just about importers and exporters. Manufacturers, retailers, investors, and logistics providers will all feel the impact, with obligations and expectations rippling through entire supply chains.
Why Companies Need to Act Now
Meeting EUDR obligations isn’t just a box-ticking exercise. Businesses will need to:
- Map supply chains down to farm or plot level
- Collect and verify data on origin and deforestation status
- Submit compliance statements via the EU Information System
- Update policies, contracts and training
- Align ESG reporting with frameworks like CSRD and the German Supply Chain Act
Those who delay risk supply chain disruption, regulatory investigations, and reputational damage as well as potential fines of up to 4% of the businesses EU turnover in the preceding year and confiscation of the covered products or the revenues gained from them.
How We Can Help
At Quastels, we guide businesses through the EUDR’s complexities and turn compliance into a competitive advantage:
- Regulatory Guidance – tailored advice on EUDR obligations
- Contractual Safeguards – drafting supplier clauses and updating agreements
- Due Diligence Frameworks – designing robust compliance systems
- Risk Management – mitigating liability and handling disputes
- Training & Policy Development – empowering your teams to stay ahead
The Bottom Line
The EUDR represents a major shift in sustainability and supply chain governance. Businesses that prepare will not only mitigate risk but also strengthen brand reputation, investor confidence, and customer trust.
Is Your Organisation Ready?
Let’s talk about how we can help build a deforestation-free compliance strategy. Contact our ESG team via the form below.
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Protecting Your Business: Are Your Restrictive Covenants Likely to Stand Up in Court?
This article was published in the September/October 2025 edition of London Business Matters.
An employee leaves your employment. Within two weeks, they’re sitting at a competitor’s desk, calling your best clients, armed with your pricing strategy and inside knowledge of your company. You might think your ‘iron-clad’ contract will stop them. However, unless your restrictive covenants have been thought through carefully and well drafted, you could find they’re not worth the paper they’re printed on.
Clauses such as non-compete, non-solicitation and event confidentiality terms protecting specific information after employment ends, can be vital in protecting your client relationships, know-how, and commercial strategy.
Restrictive Covenants are generally considered anti-competitive, and the law aims to balance the right to protect your business with an employee’s right to earn a living; only clauses that go no further than are ‘necessary’ will be enforceable.
What will a court look at?
- Legitimate business interests. The restriction must protect something genuinely valuable to your business, such as trade secrets, client connections, or workforce stability. Preventing competition for its own sake will not pass the test.
- Reasonableness of scope. Restrictions must be proportionate in terms of duration and geography.
- Tailored to the activity. Senior executives may warrant broader restrictions than junior staff. Generic ‘cut and paste’ clauses will often fail to persuade a court legitimate business interests that need protecting.
Common pitfalls
All too often, businesses rely on template documentation or blanket clauses that try to cover every eventuality. Overreach is dangerous; if even part of the covenant is too wide, the entire clause can be struck out.
Practical steps
- Be precise and define the information you are seeking to protect: name companies or the nature of a business which is competitive or territories which you wish to protect rather than using vague, sweeping terms.
- Audit at key stages: review restrictions when roles change or when broader access to business information is given.
- Consider garden leave: keeping a departing employee out of the market during their notice period can buy valuable time.
- Move fast: if you suspect a breach, prompt action is vital in demonstrating to a court the risks your business faces.
Properly drafted and well considered restrictive covenants are key in protecting business interests. Not giving them the time and respect they deserve will only see hard earned business advantages slip away to competitors.
To discuss the contents of this article, please contact Dipti Shah via the form below.
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