Hi all,
I know what the potential tax implications are for the person giving the cash gift and the annual allowances etc.
But can I please confirm if my understanding is correct that for the person recieveing it, as it is a cash gift, there are no tax implications.
Thanks in advance.
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If tax was payable on gifts, then most of us would dislike Christmas and birthdays.
BUT
If the gift is from an aged relative that is looking to avoid care costs, it could be repayable in full.
If tax was payable on gifts, then most of us would dislike Christmas and birthdays.
BUT
If the gift is from an aged relative that is looking to avoid care costs, it could be repayable in full.
And, as always, there may be more to the “gift” than meets the eye. Just because it’s described by a client as a gift, doesn’t mean it’s a gift legally or for tax purposes. So gifts to employees, for example, need to be scrutinised.
A prior thread referred to gifts
Yesterday I gave £10 to a waitress. She probably needs to declare it
Agree entirely, circumstances of 'gift' determine the tax position and any other consequences
The OP's accountant would be asking what exactly are the circumstances of the gift before giving an opinion
There are never "no tax implications" (at the very least, the money received is now part of the recipient's IHT Estate); what other implications there may be depends. Trivial example: when I say "keep the change" to a tradesperson, I make a cash gift. (Generally these days it's only taxi drivers and Big Issue sellers - everything else is contactless.) That cash gift is taxable as income of the tradesperson.
And those are genuine gifts I'm making. What kind are you talking about?
Crossed in the posting with comments that already make these points. Good stuff David and Paul.
Its funds they received from their parent. It is less than 10k; so yes the mother exceeds the annual 3k allowance per year but just am unsure on the implications, if any for the recipient.
Sorry for hijacking TD but I was about to post before your previous excellent response (and those of others).
@ OP
The gift (assuming it IS a gift) will create a PET.
Were the PET to 'fail' there may be tax implications on the estate.
Where there is an existing CLT, there may be further implications to.
If the donee is the beneficiary of the estate, there would be 'indirect' tax implications (insofar as IHT would effectively reduce the distributable value of the estate).
If you're not an accountant/ tax adviser, or have limited experience in IHT, you (or the client) should seek professional advice.
IMHO, IHT is one of the most overlooked, least understood (believe me, I'm no expert - TD is), and potentially the most costly, of all taxes. Effective IHT planning is essential and certainly not childsplay!
Please note, the above is a complete simplification, and includes no references to legislation, or potential further implications that may be relevant to the specific case in hand!
Where I am in complete agreement with TD, "there are never 'no tax consequences'" when considering gifts!
N.B. Post started at 14:30 so I apologise if I've duplicated comments posted by those with faster keyboard skills (I'm using my phone)!
Potential tax liability if the recipient is based in France .... unlikely scenario but thought I'd chuck another angle in
Really interested
How does a gift become taxable in France? Does donor get tax relief?
In Japan I am aware that gifts for specific occasions are culturally expected to be valued and 30% spent on a gift back to original donor
Me, rather not have the gift is I am expected to comply. Sheldon had the same problem with a gift from Penny in the Big Bang Theory
https://www.french-property.com/guides/france/finance-taxation/taxation/... gives a broad summary. Not had to look into it any depth but seems to be a mine field!