Money experts - advice please!

Raumarik · 19 Dec 2007 at 19:50

I live in Scotland - before anyone quotes English only laws

I've come into a fairly substantial amount of money, I'm wanting to eithe transfer some money to my fiancee or pay off some of her debt - is it OK for me to do that or will I incur some sort of charge/tax for doing so?

It's probably be £5000 - £6000 total at the moment, rest is going in savings etc.

I've never had a decent amount of cash in my account, hence me being a tad clueless about this sort of thing

neodude · 19 Dec 2007 at 20:17

Shouldn't be an issue I would imagine. Although In Lanarkshire I hope you have some extra door locks fitted lol.

Rotty · 19 Dec 2007 at 20:21

there will be no issues at that amount

Jokester · 19 Dec 2007 at 20:22

Gift limit is £3000 a year I believe, though this won't matter once you're married.

Jokester

mario2004 · 19 Dec 2007 at 20:31

There should be no problem transfering the money into her account. However, if some of her debts are bank loans you may get incur an early repayment charge which is usually 2 months interest.

As for your money you are putting into savings...at the minute Alliance and Leicester are offering a 12% rate (on annual savings) so thats something to look into.

Cemetery · 19 Dec 2007 at 22:20

mario2004 said:
As for your money you are putting into savings...at the minute Alliance and Leicester are offering a 12% rate (on annual savings) so thats something to look into.

That is a regular savings account that you can only put in £10-£250 a month into not something for a lump sum like he has.

A2Z · 19 Dec 2007 at 22:47

Jokester said:
Gift limit is £3000 a year I believe

what does this mean?

surely you can just withdraw x amount from your account, and just give it to someone cash in hand? why would there be a 'limit' and how exactly can it be enforced?

Haircut · 19 Dec 2007 at 22:49

A2Z said:
what does this mean?

surely you can just withdraw x amount from your account, and just give it to someone cash in hand? why would there be a 'limit' and how exactly can it be enforced?

Well if you start withdrawing large sums in cash it might prompt them to investigate you.
You can't just take out £50K and give it to someone as a gift.

A2Z · 19 Dec 2007 at 22:50

Haircut said:
Well if you start withdrawing large sums in cash it might prompt them to investigate you.
You can't just take out £50K and give it to someone as a gift.

who would investigate you and why?

why not?

Skull · 19 Dec 2007 at 22:53

You can gift a person a £500,000 house... I don't think £5000 is going to get taxed 40%.

div0 · 19 Dec 2007 at 22:53

Remember the tax man tries to get his hands on your money at any given opportunity!

Haircut · 19 Dec 2007 at 22:57

A2Z said:
who would investigate you and why?

why not?

HMRC would investigate you.
That would probably just happen if you randomly took out large sums in cash.
Generally because it's unusual behaviour - not many people take that sort of cash out for a legitimate purpose.

You can give someone a large gift, but it becomes subject to inheritance tax over £3,000.
Because it comes under inheritance tax rules if you survive for 7 years after giving the gift you'll be OK though (it's designed to stop people giving all their money away tax free before they die really)

Jokester · 19 Dec 2007 at 23:02

Skull said:
You can gift a person a £500,000 house... I don't think £5000 is going to get taxed 40%.

The tax man is going to be very interested in you if you do that.

Jokester

GarethDW · 19 Dec 2007 at 23:11

As said, "gifting" someone a big wad of cash without telling HMRC ain't gonna make you popular with the taxman.... otherwise people would be doing this sort of thing all the time to reduce their tax bills

mattpc · 19 Dec 2007 at 23:19

If you pay her debt off for her by say transfering the money straight from your account to the creditors account then how is HMRC going to tax her? Unlikely they are going to ask questions if she is employed rather than self employed?