Do I have to pay tax on a 1kg gold bar I got as gift from parent to help for deposit

morille

My french parents want to help me to built a deposit to buy a flat in uk (I am living and working in the uk) by giving me a 1kg gold bar. I would like to know if I will have to pay tax to the HMRC when I sell the bar in the UK. If I sell it in france I pay straight away 8% on the value and will lose 2-3% more when I change euros into pounds. Thank you

chrismac1

Even if you are a UK tax resident - which you may not be - you have an exempt band of 10,600 for a disposal in the 12-13 tax year. You are deemed to have acquired the gold at the market price ruling on date of the transfer. So suppose this bar is £30k today.

You'd have to sell it for nearly £41k, less buying and selling costs, to incur any tax liability ASSUMING you have no further capital disposals in this tax year.

On foreign exchange, google "HiFX" (who I can recommend, saved one client over £10k per year) or other forex brokers. NO WAY should you be even thinking about a 3% hit on conversion from euros!

morille

Thank you for the quick answer Christmac1 . I am indeed paying my taxes in the UK. I have no capital gain disposal this year. So If I have not to worry about the HMRC, I should definitely sell the bar in the UK to save 3 or 4K instead of selling it in france and pay the 8% tax to the gold shop. I had no idea how much the bar was bough by my grand parents 40 years ago who then give it to my parents. So I was wondering how to calculate capital gain tax on that gift.

chrismac1 wrote: »

Even if you are a UK tax resident - which you may not be - you have an exempt band of 10,600 for a disposal in the 12-13 tax year. You are deemed to have acquired the gold at the market price ruling on date of the transfer. So suppose this bar is £30k today.

You'd have to sell it for nearly £41k, less buying and selling costs, to incur any tax liability ASSUMING you have no further capital disposals in this tax year.

On foreign exchange, google "HiFX" (who I can recommend, saved one client over £10k per year) or other forex brokers. NO WAY should you be even thinking about a 3% hit on conversion from euros!

agrinnall

As Chrismac1 said, the value for CGT purposes for you is the market value on the day it was gifted to you, so the price paid when it was acquired is irrelevant. You only need to worry about CGT if the increase in value from the day you are given it to when you sell is more than £10,600, or if the value at the time of sale is more than £42,400 (you have to complete a tax return if you dispose of assets valued more than that even if no CGT is due - the figure is probably a bit higher for this year but the HMRC website example still refers to 2011-12).

http://www.hmrc.gov.uk/cgt/intro/report-gain.htm

uncommonadvice

Is your Dad Goldfinger?