Cash gift from Family visitor to UK

sdd7677

Hi,

My parents and in-laws visited us from india few times over last 2-3 year as we had our first child in UK. They bring around £4000-£6000 each time they visited us and didn't spend much money and left remaining cash here hoping to use at some point. Now we have around £20000 cash in total that they want to give as a gift as they won't be able to come back for another 2-3 years. I do not know about the legality whether I can put this money in my daughter's account straight away or I need some letter or proof from them that they are giving this money to my daughter or us?

ceeforcat

No tax implications for the recipient on a gift in the UK.

Absolutely no idea of Indian tax rules and any implications on your parents as a result of their gift(s) .

CTA_2

Gifts do not form part of your income for IT purposes.

No disposal of assets so a CGT charge would not arise.

No IHT as no negative transfer of value from your estate.

Enjoy your fortunate gifts!

CLAPTON

if the money goes into a child's account do remember it will legally be the childs and they will be able to spend it when they are 16

there are issues round the tax status of any interest earned... if parents give their own children money then only the first 100 in interest is tax free; anything over that is deemed the parents income and taxed accordingly.
if the money comes from grandparents then the interest can be received tax free up to the normal tax allowance.

Mary_Hartnell

Actually it is not a clever idea for you to open an account for your under age child, as any interest/dividends (if over £100 for the year) will be treated as your income and taxed as such - where as you child has a personal allowance and can reclaim any tax deducted from interest (but not dividends any more).

It would be more sensible for the grandparents to operate the account as bare trustee for the child; however as they are resident in India that could cause additional questions to be asked there and here - does the child have a favourite trustworthy uncle here to act as trustee?

Ages at which children can be accepted (and the interest paid) for accounts in their own name vary by institution.

Either way the money will legally be the property of the child to do as they wish and to report under their own signature at the age of [STRIKE]18[/STRIKE] 16 - though if the account is still at "uncle's" address then they might find the hassle of getting at it as not worth the effort; until after the desire to buy drugs and and kill themselves has passed.

SNAP Clapton

sdd7677

Thanks for all the reply. Much appreciate your help.

I appreciate if someone can point legality or how to declare this cash money which is coming through parents/in-laws as they brought cash with them within legal limit for visitor for 3-4 times. Will I get questioned from HMRC and if so, is it enough if I get letter from parents and in-laws saying that it's from them. Never had to deal with any tax thing as I am an employee. Thank you.

grey_gym_sock

is that an indian law about how much cash can be taken out at a time? hmrc don't attempt to police indian laws.

if you deposit that much cash in an account, you can expect questions about where it came from because of money-laundering legislation. i'm not sure if any particular document is required. i'd just be prepared to answer questions.

are your relatives giving the money to your daughter or to you?

if they're giving it to your daughter, then all the interest on it will be hers (even if over £100 a year). if they're giving it to you, and then you give it to your daughter, then you have the problem that if interest exceeds £100, it's your income, not your daughter's. this rule applies specifically to gifts from parents to children. so if the money is being given to your daughter, it's better that it's given directly.

if it's given to your daughter, directly or indirectly, it's hers to do whatever she likes with when she's 18 (or, i think, 16 in scotland).

if it's not really being given to your daughter at all, then putting it in her account could be regarded as tax evasion.

CTA_2

grey_gym_sock wrote: »

is that an indian law about how much cash can be taken out at a time? hmrc don't attempt to police indian laws.

if you deposit that much cash in an account, you can expect questions about where it came from because of money-laundering legislation. i'm not sure if any particular document is required. i'd just be prepared to answer questions.

are your relatives giving the money to your daughter or to you?

if they're giving it to your daughter, then all the interest on it will be hers (even if over £100 a year). if they're giving it to you, and then you give it to your daughter, then you have the problem that if interest exceeds £100, it's your income, not your daughter's. this rule applies specifically to gifts from parents to children. so if the money is being given to your daughter, it's better that it's given directly.

if it's given to your daughter, directly or indirectly, it's hers to do whatever she likes with when she's 18 (or, i think, 16 in scotland).

if it's not really being given to your daughter at all, then putting it in her account could be regarded as tax evasion.

Not if correctly reported on OP's tax return. Quite a bold statement you make, an incorrect one at that.

sdd7677

grey_gym_sock wrote: »

is that an indian law about how much cash can be taken out at a time? hmrc don't attempt to police indian laws.

if you deposit that much cash in an account, you can expect questions about where it came from because of money-laundering legislation. i'm not sure if any particular document is required. i'd just be prepared to answer questions.
QUOTE]

Thanks again for all your help.

Non EU Visitor to UK can carry £7500 (10,000 euros) without declaring and that's what they did.

From all your suggestion, I think the best idea is to keep in our account so that we can keep control of money which can be spent on her education and better life.

Daniel_Elkington

You could set up her account and get them to transfer the money straight into it, therefore there is no need for trusts or wierd money handling incedents.

grey_gym_sock

CTA wrote: »

Not if correctly reported on OP's tax return. Quite a bold statement you make, an incorrect one at that.

sure. i was just pointing out a potential issue. (and i'd say it was perfectly correct, since i used the word "could".)

sdd7677 wrote: »

Non EU Visitor to UK can carry £7500 (10,000 euros) without declaring and that's what they did.

ah, i didn't know that.