freerskier

Hi there fellow expats.

I want to help my brother out and give him some cash. Nice huh!

Just wondered what the tax rules are transferring money to the uk and what amounts are deemed appropriate that don’t attract attention? I don’t think from my research there’s any tax or reporting requirements as long as it’s not billions.

Im gonna give him £40000 and was thinking of sending it via XE to my Natwest account initially. I’ve used XE tons in the past to send 10k chunks to the US - great service by the way - now I’m just sending it back the other way. Oh and by the way all tax paid on the money as it’s originally from my mums estate.

Cheers dears.

Pulaski

Receiving gifts in the UK has no tax consequence (giving gifts if the donor is in the UK has potential consequences, but that isn't your situation). Giving gifts has no tax consequences in the US if the donor is in the US AFAIK.

Don't worry about the amounts - there are tens of thousands of wires sent from the US daily, many of them to the UK and many are vastly larger than the sum you are sending. The worst things that you can possibly do are (i) to worry about your transfer "attracting attention" (it won't, unless you or your brother are a known terrorist or drug dealer, or one of you are unfortunate enough to have a name similar to someone who is, and in any case it is the name that attracts attention not the size of the transfer), and (ii) to do anything to try to avoid attracting attention, because if there is one thing that is guaranteed to attract the attention of the banks at one of both ends of the chain, that is to try monkeying around with your transfer to try to avoid attracting attention to your transfer. A classic example is breaking the transfer into several small amounts - which is exactly the sort of activity that banks are looking out for! If your transfer is clean, legit, and you have nothing to hide, then that is how your should behave - send your transfer, clearly described, using your name and the name of the recipient, and send it in one lump sum.

BTW you might want to explore how competitive your bank is in exchanging your dollars for GBP by asking for their "dealing desk rate" (use those words) as exchanging $50k is enough that banks will do a significantly better rate than for small sums, and it is likely that they are competitive with XE, which I hear is not very competitive these days. You might also look at TransferWise that is widely tipped as currently recommended for offering competitive exchange rates.

freerskier

vespucci

Someone told me a few years ago that if you give over $14,000 to one person in one year you have to report it. So the OP should check if there are any reporting requirements under current rules.

freerskier

MidAtlantic

From this IRS link it appears that it is subject to gift tax because it exceeds the annual exclusion, currently $15,000. https://www.irs.gov/instructions/i70...40297522569072

Note.

Only the annual exclusion applies to gifts made to a nonresident not a citizen of the United States. Deductions and credits are not considered in determining gift tax liability for such transfers.

Pulaski

Maybe I am incorrect, but because the gift mentioned in post #1 is in GBP, I was assuming that the recipient lives in the UK and is not a US citizen.

MidAtlantic

I think it is the other way, but I have been known to be wrong ... "transferring money to the uk" .... "I’ve used XE tons in the past to send 10k chunks to the US - great service by the way - now I’m just sending it back the other way".

Pulaski

Everything I have posted refers to sender in the US, sending USD, exchanging USD for GBP, and recipient in the UK receiving GBP, ...doesn't it? …. Which is what Freeskier asked about, right? … As per the bits of post #1 that you quoted in post #8.

Mercury39

Technically, consequences only when total gifting has exceeded the lifetime exclusion, currently $11.4 million. If amount of gift > $15,000 in one year then you need to file a gift tax return.

Pulaski

Thank you for that additional information. It is good to know that my gifting has a little way to go before I reach the exclusion limit.

freerskier

Pulaski

Yes.

durham_lad

freerskier

Thanks for all the advice looks like its IRS form 709 as the gift tax return.

What I intend to do is actually transfer the money through XE to my own UK GBP current account and then write my brother a check or transfer it in GBP to his current account - does that change anything?

Thanks again team.