Transferring money to Uk.
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. |
Re: Transferring money to Uk.
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. |
Re: Transferring money to Uk.
Thanks for the comprehensive reply. Pretty much what I thought but needed that kind of clarifying advice from the expat diaspora. I’ll look at transferwise too - thanks for the tip. |
Re: Transferring money to Uk.
Originally Posted by Pulaski
(Post 12680147)
Giving gifts has no tax consequences in the US if the donor is in the US AFAIK.
|
Re: Transferring money to Uk.
Thanks, I’ll look into it. |
Re: Transferring money to Uk.
Originally Posted by freerskier
(Post 12680218)
Thanks, I’ll look into it. 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. |
Re: Transferring money to Uk.
Originally Posted by MidAtlantic
(Post 12680317)
…. 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.
|
Re: Transferring money to Uk.
Originally Posted by Pulaski
(Post 12680346)
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.
|
Re: Transferring money to Uk.
Originally Posted by MidAtlantic
(Post 12680363)
I think it is the other way, but I have been known to be wrong :o... "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".
Originally Posted by Pulaski
(Post 12680147)
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. BTW you might want to explore how competitive your bank is in exchanging your dollars for GBP ....
Originally Posted by Pulaski
(Post 12680346)
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.
|
Re: Transferring money to Uk.
Originally Posted by Pulaski
(Post 12680147)
Giving gifts has no tax consequences in the US if the donor is in the US AFAIK.
|
Re: Transferring money to Uk.
Originally Posted by Mercury39
(Post 12680751)
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.
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Re: Transferring money to Uk.
So, just to clarify I in the US my brother is in the Uk. I am an LPR. And he is a British resident. Do do I need to do a gift tax return as I’m giving him over $16k. |
Re: Transferring money to Uk.
Originally Posted by freerskier
(Post 12680934)
..... Do do I need to do a gift tax return as I’m giving him over $16k.
|
Re: Transferring money to Uk.
Originally Posted by freerskier
(Post 12680934)
So, just to clarify I in the US my brother is in the Uk. I am an LPR. And he is a British resident. Do do I need to do a gift tax return as I’m giving him over $16k. I did something similar for my sister a few years back and when I came to transfer the money from my UK bank to hers I called my bank as the daily limit for free transfers you can do yourself is £10k. They told me that to avoid fees I could do the transfer in chunks of £10k every day, so my sister also informed her bank of what was about to happen simply to avoid suspicion of such transfers. |
Re: Transferring money to Uk.
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. |
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