A Warning To Generous Parents

In this tough economic climate when our children are finding it hard to put their foot on the property ladder for the first time, it may be tempting to consider helping them out. There may also be sound tax planning reasons that you might want to pass on some of your wealth to your children now rather than waiting until you die. However, you should think very carefully before doing so about how the gift or benefit is to be structured to ensure that the help benefits your child and not his or her spouse, civil partner or co-habitee. For simplicity we will deal with financial provision on divorce but the same considerations apply to financial provision on dissolution of a civil partnership. We will also address the issue of co-habitations.