How JustAnswer Works:
  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site.
    Ask follow up questions if you need to.
  • 100% Satisfaction Guarantee
    Rate the answer you receive.
Ask bigduckontax Your Own Question
bigduckontax
bigduckontax, Accountant
Category: Tax
Satisfied Customers: 4082
Experience:  FCCA FCMA CGMA ACIS
75394688
Type Your Tax Question Here...
bigduckontax is online now

My friend (not family member!) is going to give me rather large

Customer Question

My friend (not family member!) is going to give me rather large sum of money as a gift. Do I need to pay tax on it?
Submitted: 1 year ago.
Category: Tax
Expert:  bigduckontax replied 1 year ago.
Hello, I am Keith, one of the experts on Just Answer, and pleased to be able to help you with your question. The UK does not have a gifts tax regime so the money you receive is outside the scope of UK taxation. Thank your lucky stars you don't live in France where gifts tax kicks in at 5K euros! There is one point to consider. A gift of this nature creates a Potentially Exempt Transfer (PET) in the Inheritance Tax (IHT) affairs of the donor. PETs run off at a taper over seven years and in the event of the donors decease within that period are added back to his estate for IHT and are the first to suffer the tax. If the estate is inadequate to meet the IHT on the PET the liability cascades down to the beneficiary for immediate payment. I do hope that my reply has been of assistance. In general terms there is no tax to pay when you receive the gift.