Proceeds from sale of house - keep under the stairs !!

A_Nice_Englishman

seven-day-weekend wrote:

Yes I'm sure they would. But the UK authorities wouldn't need to know about my sale in Spain, would they, if I'd already paid all the Spanish legal taxes?

Um, Dunno! Personally I'd get advice from an accountant who knew about these things if I was doing it.

Mikeyorks

losgiganteskid wrote:

The B/Soc has a duty to notify the I Rev of all interest paid

The Bank / Bldg socy are mandated to tell the Revenue of all interest bearing accounts .... but it is you who have a duty to inform them of all interest received and which could lead to a change in your tax situation.

The Revenue will likely find out about the sale .. they will certainly do so if the sale is above the Stamp Duty threshold

losgiganteskid

Thanks for all the replies folks - let me confirm that the guy in question who is selling his house is not trying to avoid paying tax on the interest earned on the sale proceeds, but merely wants to avoid putting the money in his name (ie having the B/Soc account in his name) as if that was the case the I/R would surely contact him and state words to the effect "you are receiving £xxx,xx per month interest which is being taxed at source at 20% but we need you to fill in this tax return for us to see whether you are receiving any other funds which would trigger your tax liability at a higher rate" (or words to that effect).

The thought is that if the proceeds of sale are sent to the B/Soc account of his partner (who was NOT the owner or part owner of the house sold) then it would be his partner to whom the I/R would contact regarding tax. The guy is not trying to avoid tax being paid on the sale proceeds - merely making himself invisible to the tax man. The partners tax situation is such that even with a substantial amount of dosh being deposited in her account the fact that it is taxed at source by the B/Soc is sufficient as she would not even with her other income be taxed at the higher rate. The downer as I see it is that by "giving" a substantial amount of dosh to "a partner" could spell financial disaster should either he or his partner die in the short term, or indeed his partner does a runner with the dosh.

Ian_W

Which is why I suggested he sends it to me!! :mad:

I'm trustworthy you see. :rolleyes:

To be more serious - he risks all his capital if his partner pegs it or falls out with him - as against paying 20% more on the interest from that capital. He either has very, very good reasons for not wanting to fill in a tax return :eek: or he's a very severe risk taker.

clutton_2

has he made a will ?

ManAtHome

And yes, bunging it under the mattress would work - tax due on 0% interest is around... urmmm... 0% (or infinity, I forget which way it works).

Personally, I'd go for 60% of 5.whatever%

BobProperty

losgiganteskid wrote:

.... then it would be his partner to whom the I/R would contact regarding tax. The guy is not trying to avoid tax being paid on the sale proceeds - merely making himself invisible to the tax man. The partners tax situation is such that even with a substantial amount of dosh being deposited in her account the fact that it is taxed at source by the B/Soc is sufficient as she would not even with her other income be taxed at the higher rate. The downer as I see it is that by "giving" a substantial amount of dosh to "a partner" could spell financial disaster should either he or his partner die in the short term, or indeed his partner does a runner with the dosh.

So he's just trying to avoid paying higher rate tax

andi2

I don't know anything about the ins & outs of this, but I filled in my brother's forms for his house sale on Tuesday (so 3 days ago). It stated on his paperwork that the money could only be sent to the seller & not to anyone else. I'm not sure if that is just his solicitors or if that's a general rule, so might be worth checking out.

losgiganteskid

andi2 wrote:

I don't know anything about the ins & outs of this, but I filled in my brother's forms for his house sale on Tuesday (so 3 days ago). It stated on his paperwork that the money could only be sent to the seller & not to anyone else. I'm not sure if that is just his solicitors or if that's a general rule, so might be worth checking out.

Does anyone else know whether this is true or not

seven-day-weekend

Seriously, I would imagine that the proceeds of the sale of your house would be classed as your money, no matter whose account it was paid into.