Receiving 'gift' money from family member when receivng Tax credits

ironman1

Hi all,

We currently receive £50 a week Tax Credits and i'm self employed so have to send off my self assessment every year.

My Mum has just received some money and given me £1,500 by cheque.

I honestly hate taking any money off of family so want to use this to open my little baby an ISA SAVINGS account for when he's older.

The cheque is in my name by the way. Can anyone please tell me what the HMRC etc will make of this? I can just imagine them making us pay back the tax credits or something, which we rely on!


Thanks

00

ironman1

By the way would i have to declare it in my next self assessment? Cheers

Regshoe

As it's a gift and not earned income it doesn't need to be declared on your self-assessment and you don't need to pay any tax on it. Not an expert on tax credits but I believe the same applies - it has no effect.

John_Pierpoint

It could be better if the grandparent made the cheque out to the infant as it will not pass through your account, and just might get confused with your self employment opportunities to do work "off the books". .

That said here is the official MSE guide: http://www.moneysavingexpert.com/savings/child-savings-tax-free