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TonyTax, Tax Consultant
Category: Tax
Satisfied Customers: 15975
Experience:  Inc Tax, CGT, Corp Tax, IHT, VAT.
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I am a resident in England. I was recently given a gift of

Customer Question

I am a resident in England.
I was recently given a gift of £100000 by my brother in Hong Kong which is held in joint account in HK.
I have the following questions:
1 My understanding is this will count towads inheritance tax ceiling of £325000 which expires after 7 years if my brother ios still alive.
2 The bank interest has be be declared in the tax return but am I required to inform the Revenue of the gift?
2 If that is the case, what is the mechanics of informing the Revenue
Many Thanks
Submitted: 3 years ago.
Category: Tax
Expert:  TonyTax replied 3 years ago.

1 Assuming your brother is not UK domiciled, only his UK estate will be subject to UK Inheritance Tax. If the gift was made to you from a foreign currency account in the UK or from abroad, should he die within seven years of making the gift it will not be included in his estate for UK IHT purposes. It it was made to you from a UK bank account denominated in UK Pounds or from UK based assets then it will be included in his estate for UK IHT purposes.

2 You don't need to inform HMRC of the gift but it would be as well to have your brother write you a letter confirming that the details of the gift so you can prove its provenance if you are asked by HMRC or your bank for example.

3 Not applicable. You need do nothing as far as HMRC are concerned unless they ask where the money came from.

I hope this helps but let me know if you have any further questions.