Selling a house abroad

uumai

Hi All,

I am hoping someone can help and /or point me in the right direction.

About 5 months ago I married my gf of 7 years. Her mother (her only parent) gave us one of her houses. (They are both originally from Brazil and the houses are there).

We want to sell the house and believe based on curent exchange rates it's worth about £20,000. This we are selling to help us move towards getting a house in UK within the next 2-5 years.

The property in Brazil is not in her mother's name but her Aunts who my mother-in-law sent the money to to buy it.

I am aware of the CGT expemtion of 10,600 so in theory we could split the money between us and it would be exempt from what I can tell. However, as the house in not in our name, and aside from my Wife's family in Brazil have no proof that it is our, or even her mother-in-law's house. Does this affect anything?

As for transferring the money. My wife does not have a Brazilian bank account. Would transferring from someone else's account to each of ours (or one of our's if it doesn't matter) cause any trouble?

Would we need to alert any one? I'm hoping there is some way to avoid tax on it, but want to do everything above board.

Any help would be very much appreciated.

Additional info if it helps. We are both employed full time in the UK and basic tax payers. I'm not experienced with any of this and my wife is worse with it than I. If I can provide more info to enable you to better advise please let me know.

Regards,
Chris

CLAPTON

I have no idea what the tax laws are in brazil

however, there is no gift tax in the UK so I see it, there is no UK tax for a gift from your MIL to yourselves


there is no UK problems about transferring money from abroad to the UK

uumai

Thanks for the speedy reply Clapton.

Does the gift if counted as the money, rather than the property then fall into a potentially exempt inheritance? Looking on the HRMC site it seems like cash gifts up to £5,000 are free from it from what little of it I understand.

Do I need to inform anyone or do anything?

Many thanks

tyllwyd

So legally this house is in your gf aunt's name, in Brazil? I don't think this would come under capital gains tax for you because officially your gf doesn't own it. Is there any similar tax in Brazil that your aunt might have to pay?

When it is sold there will be money to come from Brazil to your gf in the UK - I would assume will come as a gift from your aunt to your gf. There is no gift tax in the UK but again, your aunt needs to find out if there is any tax to pay in Brazil.

Then I guess a substantial amount of money from abroad might look suspicious under the money laundering regulations - I think I'd go and have a chat with your bank to see if there is anything you need to do.

In terms of inheritance tax, the money isn't coming from your mil in the UK it is coming from Brazil, so again, it is the Brazilian law you need to find out about.

Cook_County

Your wife is a non-dom so if she does not need the money in the UK could invest it offshore and use the £2,000 tax-free allowance for non-doms on any income

CLAPTON

uumai wrote: »

Thanks for the speedy reply Clapton.

Does the gift if counted as the money, rather than the property then fall into a potentially exempt inheritance? Looking on the HRMC site it seems like cash gifts up to £5,000 are free from it from what little of it I understand.

Do I need to inform anyone or do anything?

Many thanks

gifts in the UK are free of tax

It's unclear if your wife or MIL actually own the property ; anyway it makes no proctical difference in the UK as you will be bringing in the money equivalent

capitat gains tax is irrevelant in this case

inheritance tax is a tax on the estate of dead people; IHT would be potentially relevant if your MIL was a UK resident for tax purposes, died within 7 years and had an estate of more than 325,000 (or 650,000 if she can use her husbands IHT allowance

uumai

Thank you all for your replies :beer:. It seems ideal then.

I will speak with my wife and have her speak to her aunt in Brazil regarding laws etc.

The main thing now then is about money laundering regulations and getting the sum over here. I'll try to speak with the bank and see what they say. on a side note, would it be better to make the payment across in two smaller sums of £10k?

Thanks again.

dzug1

uumai wrote: »

Thank you all for your replies :beer:. It seems ideal then.

I will speak with my wife and have her speak to her aunt in Brazil regarding laws etc.

The main thing now then is about money laundering regulations and getting the sum over here. I'll try to speak with the bank and see what they say. on a side note, would it be better to make the payment across in two smaller sums of £10k?

Thanks again.

That would probably make it look worse

uumai

dzug1 wrote: »

That would probably make it look worse

Sorry, what I had meant to add was 10k in to her account and 10k into mine. Not sure if it would look any better?