Cash gifts and tax?

solmend

My father, who lives in New Zealand, has sent me a gift of £3500 (for me and my family to buy tickets to go over to see him) and has asked me to pass on another £1500 to my sister, who is on income support. Do either of us need to declare this? I understand that this might come under inheritance tax rules if my father dies in the next 7 years, which unfortunately is very likely as he is now 98. (That's why we're going to see him now while he still is reasonably healthy. ) What will happen when he dies -will I need to pay tax on the 3500 or my sister on her amount? As he is a New Zealand citizen does he even need to declare this and do I when he dies? I just need to think about putting some money aside for this if necessary. Thanks.

TadleyBaggie

Nope, gifts do not attract tax. 

[Deleted User]

There is no gift tax in the UK

Jeremy535897

If your father is not domiciled in the UK for inheritance tax purposes, and the gift is made from non-UK situated assets, there would be no UK inheritance tax liability even if he gave you £10 million and died the following day.

solmend

Jeremy535897 said:

If your father is not domiciled in the UK for inheritance tax purposes, and the gift is made from non-UK situated assets, there would be no UK inheritance tax liability even if he gave you £10 million and died the following day.

But he's sent the money to me and is in my account. Is that still ok? I thought the tax was for the receiver not the giver?

[Deleted User]

solmend said:

Jeremy535897 said:

If your father is not domiciled in the UK for inheritance tax purposes, and the gift is made from non-UK situated assets, there would be no UK inheritance tax liability even if he gave you £10 million and died the following day.

But he's sent the money to me and is in my account. Is that still ok? I thought the tax was for the receiver not the giver?

The recipient never pays tax on gifts in the U.K. Gift tax simply does not exist even though this is THE most common question asked on this forum. 
Here is a link to the same question being posed on the HMRC community forum.

https://community.hmrc.gov.uk/customerforums/cgt/b7f75b45-e11f-ed11-b5cf-00155d973ade#:~:text=Hi%20mancplau%2C-,There%20are%20no%20Income%20Tax%20implications%20on%20the%20receipt%20of,potentially%20be%20subject%20to%20tax.

Jeremy535897

purdyoaten2 said:

solmend said:

Jeremy535897 said:

If your father is not domiciled in the UK for inheritance tax purposes, and the gift is made from non-UK situated assets, there would be no UK inheritance tax liability even if he gave you £10 million and died the following day.

But he's sent the money to me and is in my account. Is that still ok? I thought the tax was for the receiver not the giver?

The recipient never pays tax on gifts in the U.K. Gift tax simply does not exist even though this is THE most common question asked on this forum. 
Here is a link to the same question being posed on the HMRC community forum.

https://community.hmrc.gov.uk/customerforums/cgt/b7f75b45-e11f-ed11-b5cf-00155d973ade#:~:text=Hi%20mancplau%2C-,There%20are%20no%20Income%20Tax%20implications%20on%20the%20receipt%20of,potentially%20be%20subject%20to%20tax.

The only time a UK recipient of a gift can pay inheritance tax is if the donor dies within 7 years, and if the gift, together with any others in the 7 years before the donor's death, exceed the nil rate band (potentially up to £1 million) and the estate fails to pay the tax due. This is extremely rare. If the donor is not domiciled in the UK and the assets gifted are non-UK assets, even if the gifts in the 7 years before death exceed the nil rate band there is no UK inheritance tax to pay. The liability is based on the donor's status, not the donee's.

Albermarle

solmend said:

Jeremy535897 said:

If your father is not domiciled in the UK for inheritance tax purposes, and the gift is made from non-UK situated assets, there would be no UK inheritance tax liability even if he gave you £10 million and died the following day.

But he's sent the money to me and is in my account. Is that still ok? I thought the tax was for the receiver not the giver?

This is a widespread misunderstanding.