Foreign inheritance as part of my mortgage deposite

Chichaldo

I am a UK resident, born and currently domiciled in the UK. My family, on my mother's side, are from Turkey. I am looking to buy a house via a mortgage as a first time buyer and plan to use £10,000 from Turkey that was a part of my inheritance (Turkish grandfather) for the deposit (plus £20,000 of my own savings).

As far as I am aware, the UK does not impose an inheritance tax on the receipt of a legacy abroad as it assumes tax has already been paid by the estate of the deceased (Financial Times, 2015: 'Can I transfer overseas wealth to the UK without incurring tax?')

a) Is this (above) correct as of 2021?

A few further questions:
b) Am I liable to pay any other tax or charge in the UK for this sum?
c) What kind of proof, if any, do I need to provide to mortgage brokers about the receipt of the funds (with regard to the inherited portion)?
d) Does it make a difference if I convert the money to GBP in Turkey and bring it on my person or via a bank transfer (relates to point 'c' as it might to harder to prove to lenders, unless it is not a reason for rejecting a mortgage application)?
e) Any other factors I need to be thinking about on this matter?

Thanks in advance, appreciate any help with any of my questions

davidmcn

There are no taxation issues.

You'll need to persuade everybody it's a legitimate source of funds for the purposes of anti-money-laundering regulations. So, when did you receive the inheritance, and by what method? If you received it by say, bank transfer, and have paperwork from e.g. lawyers showing it's an inheritance, that will help, and if it was long enough ago it's possible no questions will be asked. If your grandfather kept cash under his mattress and a relative deposited it in your account last week, that's more problematic.

When/how you exchange the currency doesn't matter, as long as there's a paper trail, but please don't convert it into cash at any point, as that will make it indistinguishable from "dirty" money.