Quizzes & Puzzles46 mins ago
tax on receiving gift money
Am I liable to pay tax on this gift?
Will he be taxed for giving me this money?
Answers
No best answer has yet been selected by lynneg. Once a best answer has been selected, it will be shown here.
For more on marking an answer as the "Best Answer", please visit our FAQ.No immediate tax liability would arise, but if your friend were to die within 7 years his estate may well have to pay Inheritance Tax (IHT) on this amount since �8000 is more than the potentially exempt transfer (PET) limits.
http://www.hmrc.gov.uk/leaflets/iht2.htm
http://www.forumwealth.com/accsol/the_inheritance_tax_exemptions.html
Provided your friend has not 'gifted' to anybody in the last 18 months I believe that he could remove future tax liability on this gift if he were to split the amount into a �6000 gift in this tax year (which includes �3000 carried over from the last tax year) and the remaining �2000 in the next tax year.
All of this needs to be confirmed by a tax expert.