How to accept a cash gift from overseas

leg1t

bryanb wrote: »

Sorry, I think I'm misunderstanding you, I thought this was to be a gift in cash (Used notes etc) therefore no paper trail.

I would wish for there to be no paper trail back to the donor but the money is not of dubious origin. I therefore could provide proof of origin perhaps with a "proof of gift" letter however I would not wish to do so if I thought it would come back on the donor. Quite understandably I don't think the donor would either. When one shows such proof, I simply do not know what possibly happens between a bank in one country and a bank in another and anyone in between.

leg1t

kalaika wrote: »

Even though you may not be the one who is actually doing the tax evasion, you may find that you are deemed to be complicit in it. If you are found to be aiding and abbetting the evasion (or whatever the equivalent is in France) then you may find yourself in hot water. (I'm not saying you will get into trouble, but is just something that you may need to consider.)

I accept that is a valid point.

So far my options are:
1) Refuse the gift
2) Accept and behave like a drug dealer (buy fast cars, go on expensive trips etc.)
3) Put it under bed etc. and become paranoid.
3) Ask the donor to pay 60-70% tax (hmm, same as 1).

dzug1

leg1t wrote: »

One reads about depositing small sums in a variety of accounts over a period of time - ..

That's actually a classic definition of money laundering

bryanb

dzug1 wrote: »

That's actually a classic definition of money laundering

From the French point of view I guess that's what is being discussed.

leg1t

Fair points have been made here - it helps when you hear other the thoughts of several other people discussing the matter. On the face of it, as the recipient of a gift, I could justify to myself that I haven't done anything wrong - it's a genuine gift from a legitimate source and I am not liable to pay tax on it. Even if it might not easily be proved, I am however aware that the donor is not wishing to declare the transaction in their own country, a country which requires tax to be paid immediately. It might be hard to prove legally but of course morally I am involved - I am the reason! But all of this doesn't really become relevant until I try and do something with the cash - it is then that questions will be asked of me and in turn questions would be asked of the donor.

tyllwyd

My feeling (for what it is worth!) is that since the tax issue is about the French tax, if you want to find a legal way to avoid the tax, you need to get tax advice in France, or from someone who understands the French tax system. Maybe there would be a way to put it in an overseas trust or some such thing.

If not, I think you should find out about what the penalties for being involved in tax evasion would be in France - you seem to be assuming that it is only your friend who would be in trouble. I don't know, but I can't help thinking that you would be in trouble too with the tax authorities in France if they found out - and if you had been making lots of trips there in order to bring back cash to this country, it would be hard to convince them that you were an innnocent party who believed that it was all completely above board. Worth looking into before getting involved!

You are saying that you are only receiving a gift, so you aren't doing anything wrong - but if your friend gives you 30,000 euros of which 10,000, say, should have gone to the French tax man, you have benefited from his tax evasion by those 10,000 euros so surely that makes you part of the crime.

TM1976

Why does the French resident want to give the money to you, what is your relationship to them?

What you are asking for on advice here is money laundering, whatever justification you put on it.

leg1t

TM1976 wrote: »

Why does the French resident want to give the money to you, what is your relationship to them?

What you are asking for on advice here is money laundering, whatever justification you put on it.

I simply opened a discussion about the proposition of [read title]. I am not asking how to be a money launderer, and I do not attempt to justify myself as an innocent bystander. If one reads through this thread in its entirety, there is the matter of being complicit in evading taxes potentially payable by the other party in their own country*.

When two people wish to do something that like this, it starts as just that - a wish. It sometimes takes some research or an open discussion, such as in this forum, to reveal real implications as well as offer some possibilities or alternative thinking so that one can make an informed decision. It is the case that the donor proposed to exchange cash from a legitimate source - their bank account, earned money with income tax paid. They're free to withdraw that cash and spend it - of course that is not meant to mean gift it. It was from this point I wish to explore the idea because it is said that in the UK as long as I can justify the source of funds there is no problem in receiving it - it would appear that in this case no taxes are paid until Inheritance tax becomes due, where relevant. It is clearly more complicated when one of the parties is not resident in the UK - in France a very high gift tax is payable at source - I don't know at what rate but I understand it's something like 60 or 70%. Yes, I am still aware of * above and that it's probably not going to happen like we would have wished it to but I did not know as much and did not have as much to think about when I first asked the question.

Incidentally, this is a [proposed] genuine gift from someone close enough to wish to do this - believe it or not it happens. No hits, no kilos, no bribes.

Thank you.

TM1976

Actually I have read this post in it's entirety which I why I say that what you are proposing is money laundering, taking money obtained illegally, in this case through tax evasion, and making it look legitimate. What you are describing would be reportable under the proceeds of crime act as a suspicious transaction.

There probably is a legitimate way to avoid tax on this and I would recommend you did that as what you are proposing may get you and the gifter into trouble.

You need advice on the French tax side rather than the UK side as no tax would be due in the UK.

leg1t

Bend the rules or break them - I'm presented with a non-typical scenario and in this case I tend to look at it properly to differentiate between the two - precisely what I'm doing here and, as I have already said, I have learned here. I don't bend the big serious stuff and I've never put anyone else up ***t creek but would it not be the case that most people, with a similar offer, in the real world, would at least look at all options - correct and not so correct? Thinking is not doing - we need to look at how wrong to wake up sometimes! All warnings are noted (really) and I say thank you again, to everyone.

TM1976 wrote: »

There probably is a legitimate way to avoid tax on this

From everything I've read I'm not so sure about that however I'll take your view with optimism!