Gift from abroad

[HelenHen]

I might be about to receive a monetary gift from my parent abroad. They want to just transfer it straight to my account, but I'm just wondering what are the tax implications? It's a 5 figure sum. Will it be liable to income tax? Is there anything I need to consider or be aware of?

I'd appreciate any advice or links to the correct and current information please, as I know there have been plenty of talk of changes to these rules.

Thank you

No tax implications

IF they die within 7 years then under UK it would be included in their estate for inheritance tax (could be tapered depending on time)

if they are not Uk resident then it will follow inheritance tax and gifting rules in their own country

Ok that's a relief. Thank you so much for getting back to me.

The gift would be in euros. I still have an account in that country. Would it be best for them to just pay it to that account, or transfer it straight to my UK GBP account? Or can I open a Euro account here to receive it?

I will get advice on Monday when everything is open, but just to get an idea before then.

Open a revolut euro account, then add a sterling account. You Can then swap thé euros into sterling and transfer from thé revolut sterling account.
Alternatively open an account with a currency broker liké currency fair. You transfer the money in to their euro account and transfer out to your sterling account.

Only problem with either is the limit on transfers out of your euro account.

Thank you so much. I'll have a look at both of those options. I wouldn't need access to the money immediately, so if I need to transfer over a period of time, that's OK.

Can either of these be transferred like a simple bank transfer?

He's quite elderly so was going to go into his bank next week to do the transfer. He wouldn't be able to do anything that's online, and I couldn't help him

"Would it be best for them to just pay it to that account, or transfer it straight to my UK GBP account?"

That would depend on which specific country you're talking about and also if you have nationality of that country.

For example, in the Netherlands there are very strict rules about gifts. If you are talking about the Netherlands then you really do need to speak to somebody who understands the situation.

Other countries it won't matter so much.

You can do it either way. You would either give him details of your UK bank account including IBAN etc. See here for a couple of examples of what's required from Lloyds and Barclays:

https://www.barclays.co.uk/help/international/payments/making-and-receiving-international-payments/receive-money/

https://www.lloydsbank.com/online-banking/payments-and-transfers/international-payments/receiving-a-payment.html

Or it may be easier to just tell him to pay it into your local account there and then you can deal with transferring it to your UK account.

You may then wish to consider some different ways of transferring your money. There is an explanation here from the Money Saving Expert website:

https://www.moneysavingexpert.com/banking/foreign-currency-exchange/#larger

It's about sending money abroad, it's the same thing - you're just doing it in reverse. They recommend some firms to use to get better rates for exchanging Euros to Pounds (and other currencies)

Thank you so much. It's Ireland, so hopefully less complicated.

But yes, I will speak to someone on Monday for more specific advice.

That's been a great help though, so thanks.

Do you have online access to your euro account? If so, no problem.

My main euro account with crédit agricole has limits on transfers whether I send money via a transfer or whether I put money into a revolut account via a débit card.

Currency fair is quite simple to use but you need an account and id to transfer money in to bé exchanged and a receiving account for thé exchanged funds.

Another way would bé for your relative to do a chaps transfer direct to your UK sterling account. You then have thé fees at their end probably about £30 and fees on receipt which last Time I did it that way was about a tenner. You'd have to give your UK bank enough info to prove to them you're not money laundering which can be complicated.

I don't have online access, no.

OK maybe chaps is the best way to go. I don't mind paying SOME fees, but wasn't sure if we could save hundreds by doing it a different way. The exchange rate isn't great either, so keeping it in euros for a better rate, or for when I need euros could make sense.

Thank you

Depending on how big an amount, when (if) you ultimately transfer it to your UK account it is possible that you may get asked about the origin of the money, under the banks' responsibilities regarding money laundering. That question may come up well after the time the transfer is made, if our experience is anything to go by!! I got questioned about a low 6 figure sum a few years ago, and until I found the right person to speak to was being told I had to provide extensive information about both mine and my husband's income, which was irrelevant as the money was a gift from my mother overseas. They were happy with the details that it was surplus in her superannuation investments.

Thank you. I found out that my account in that country is still active, so I will ask him to put it there, and just leave it for now.