Spousal and Related Party Loans Where property is being purchased it is important to consider where the deposit money will come from. This is important where there are different legal entities involved - spouses, siblings, companies or trusts etc. Movement of money from one person to another has far reaching legal and taxation consequences and there are many costly legal cases which could have been completely avoided if proper documentation had been prepared. An example of what can go wrong - Steiner v Strang  NSWCA 203 https://jade.barnet.com.au/Jade.html#!sy=400596 A mother paid for a unit in the name of the son lending him $881,000. There was an unsigned loan agreement and a signed acknowledgement of loan agreement. The sons argument that the loan was forgiven upon the death of the other. The executors of the estate argued that the evidence showed the debt was still owing. Multiple court cases later and the issue is not resolved yet. Other examples involve one spouse becoming bankrupt. It is very hard to argue that you owe your spouse a large sum of money when you are bankrupt if there is no written loan agreements in place. People tend not to believe these sorts of stories. Wherever there is movement of money from one person to another legal advice should be sought (from a lawyer!) and the parties should determine whether the money will be a gift or a loan by going through all the consequences and then proper documentation prepared. There are also various tax saving and asset protection strategies to consider. Incidentally the majority of the people that I seen with established trusts have not even considered whether the money transferred to the trust to buy a property is a gift or a loan. They have no idea there is even an issue with this.