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Tax liability

Is it true that you can give an unlimited number of cash gifts up to £250 in value, without having to pay tax on them? So if I wanted to gift someone £10,000, then could I make forty gifts of £250 each? How about the receiver, would he/she have to pay tax on the income of these £250 gifts?
Do you mean to avoid inheritance tax? If not, there is no limit and you can gift and amount of cash without incurring or needing to declare tax.
Gifts do not count as 'income' for tax purposes but where is the money coming from? If large sums were being deposited into someone's account out of normal from the usual account activity (regardless of how the large sum is split up into smaller transactions) then it's going to trigger some interest. HMRC, were they to investigate it, would want to know where the money had come from and whether tax had been paid on it For instance, you cannot dispose of 'cash-in-hand' via this method as it would essentially be laundering cash.

To be honest with you, anyone who posts that they'd like to 'gift' £10000 to someone in small transactions sounds dodgy as hell.
Original post by Rian1988
Do you mean to avoid inheritance tax? If not, there is no limit and you can gift and amount of cash without incurring or needing to declare tax.


Thank you for your reply!

No, to avoid income tax. For example, if A gifted B £10k, would B be required to pay HMRC income tax on that?

Original post by Reality Check
Gifts do not count as 'income' for tax purposes but where is the money coming from? If large sums were being deposited into someone's account out of normal from the usual account activity (regardless of how the large sum is split up into smaller transactions) then it's going to trigger some interest. HMRC, were they to investigate it, would want to know where the money had come from and whether tax had been paid on it For instance, you cannot dispose of 'cash-in-hand' via this method as it would essentially be laundering cash.

To be honest with you, anyone who posts that they'd like to 'gift' £10000 to someone in small transactions sounds dodgy as hell.


Thanks for your reply!

The full tax has been paid on the money, please look at the analogy above.
Original post by londoncricket
Thank you for your reply!

No, to avoid income tax. For example, if A gifted B £10k, would B be required to pay HMRC income tax on that?



Thanks for your reply!

The full tax has been paid on the money, please look at the analogy above.


If the tax has been paid on the source of the money, then a personal gift of money would not attract any taxes in the circumstances you describe either for the recipient or the donor.
What is the situation? Who is giving who £10,000 and for what purpose?
Reply 6
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Reue
20
The £250 limit is for avoidance of inheritance tax.

There is no limit for other tax avoidances. Parents regularly gift £0,000s to their children for house deposits etc.
Original post by Reue
The £250 limit is for avoidance of inheritance tax.

There is no limit for other tax avoidances. Parents regularly gift £0,000s to their children for house deposits etc.



Are you saying that parents can give thousands of pounds for a house deposit and not pay any tax?
Reply 8
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Reue
20
Original post by Simonthegreat
Are you saying that parents can give thousands of pounds for a house deposit and not pay any tax?


Correct
Original post by Reue
Correct


I didn't think that was possible. It is subject to inheritance tax if the gift is made and the 7 year rule. Is that not correct?
Reply 10
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Reue
20
Original post by Simonthegreat
I didn't think that was possible. It is subject to inheritance tax if the gift is made and the 7 year rule. Is that not correct?


I specifically said this was not accounting for inheritance tax
Original post by Reality Check
Gifts do not count as 'income' for tax purposes but where is the money coming from? If large sums were being deposited into someone's account out of normal from the usual account activity (regardless of how the large sum is split up into smaller transactions) then it's going to trigger some interest. HMRC, were they to investigate it, would want to know where the money had come from and whether tax had been paid on it For instance, you cannot dispose of 'cash-in-hand' via this method as it would essentially be laundering cash.

To be honest with you, anyone who posts that they'd like to 'gift' £10000 to someone in small transactions sounds dodgy as hell.


I agree

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