My Mother's Savings

spoonface

hello i'm spoonface! my first post on what seems a very informative website.

my Mother is healthy and well and wants to transfer a large sum of cash from her savings account to my own. is there anything i need to consider here? will the Inland Revenue and /or concerned bank accounts be asking any questions?

i understand there are limits to to the value of gifts that can be passed onto me during the seven years preceding death. what are those limits and how is the above transaction effected by these rules if at all?

many thanks.

spoonface.

Reaper

I believe as long as she survives 7 years and it is a simple gift with no strings attached you should not have to pay any tax on it.

If she dies within 7 years there is a sliding scale of tax, although there are some exemptions. More details here.

spoonface

thanks. so a simple of transfer of cash from her account to mine would be classified as a gift?

how does the inland revenue keep track of transfers such as these? i'm a little flummoxed here.

Reaper

Yes, that would be a gift.

The executor of her will should handle all the tax claims on the estate before handing out the money.

As to how the IR checks if has been done correctly I can only guess, but they will be aware of her bank and building society accounts as the banks inform them about everybodies (unless the balance is very small).

If your mother dies and they chose to investigate they could look back to see if any large sums of money went out in the last few years and if so to whom.