Lozz360
Veteran
- Location
- Oxfordshire
Or sister could transfer shares to OP. Thereby avoiding current market losses and CGT (for now).
Advice needed
- Thread starter Deafie
- Start date
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vickster
Legendary Member
Presumably, not something I would know how to do, but I got the impression he wants the cash
Bazzer
Setting the controls for the heart of the sun.
- Location
- On the edge of reality
No it doesn't.
The transfer would be a disposal for CGT purposes. A brother/sister disposal is a connected person disposal, therefore as a starting point, the market value would be applied on the transfer. If there are gains or losses, these belong to the person making the disposal.
Lozz360
Veteran
- Location
- Oxfordshire
You are correct. I was wrong. You can gift shares to your spouse or a charity tax free but not your brother.
Deafie
Guru
- Location
- So good they named it twice
I probably am over thinking it, when I was last there I put 2k cash in the bank and had to explain to the teller where it came from. It blew my mind, I have never been asked where cash came from over here, so add to that the bank making my sister sign papers plus them telling the IRS about my funds I have got a little uncomfortable having to deal with them.No offence but no one is going to investigate you for transferring just £40k.
Most banks will let you transfer £10k a day using the fast payment system online no questions asked, so you could easily transfer the whole amount in 4 days via the phone App. If you wanted to transfer the whole amount in one goal just do an old fashioned bank transfer - but you will have to pay a fee for this.....
Employing a solicitor to oversee the transfer of £40k is mad, they will happily do it am sure and walk away with a £ks for the service.
You are seriously over thinking this if its the transfer bit you are worried about. £40k might be alot of money to you, but to the banks it's pocket change and as such doesn’t warrant any increased security.
Deafie
Guru
- Location
- So good they named it twice
Thanks, I will look into that if need be after I chat with my sister
Deafie
Guru
- Location
- So good they named it twice
Cash or shares, I just want it back in my name to avoid any fuss down the line and to be able to use it if needed
PaulSB
Squire
- Location
- Chorley, Lancashire
I wouldn't be confident in this statement. It could be true of banks, I don't know, but it wouldn't surprise me in the slightest if it did trigger something. When the authorities sniff something they can and do dig deeply.
20+ years ago the company I worked for had a routine HMRC inspection. A purely random selection. My company car was diesel and amongst my expenses claims the inspectors, there were two, found a £70 receipt for petrol. I couldn't explain this. Eventually the office manager remembered the time I accidentally put petrol in the tank. We provided an invoice from the Peugeot main dealer we used for rescue, draining the system etc.
That one receipt triggered a 15 month long investigation of my business expenses, mileage claims, travel, diaries etc. It was a nightmare. There was nothing to find and nothing was. It ended when I had a genuine meltdown with the inspector telling her she'd made me feel like a criminal for over a year.
I wouldn't be surprise to discover banks are obliged to inform the authorities, probably HMRC, of any slightly unusual activity which might trigger an investigation.
ColinJ
Puzzle game procrastinator!
- Location
- Todmorden - Yorks/Lancs border
I had the same thing when I got a large cheque from the sale of my house. (I can't remember why the solicitor didn't do a direct bank transfer!) I had to show the covering letter to prove what the money was for.
I owed my sister a large amount of money and wanted to transfer that sum to her. I had to get written evidence from her of why I owed it to her and present that at the bank. That was a week after paying the solicitor's cheque in.
A couple of weeks later I received another cheque for several thousand pounds from another solicitor - an inheritance from a friend who had died a couple of months earlier. I got some really intense looks when I presented that cheque.
It was the same woman who dealt with me each time and she was definitely suspicious about the large sums of money suddenly moving through an account that had been almost dormant before that!
It was probably your face that made her suspicious rather than the money ...It was the same woman who dealt with me each time and she was definitely suspicious about the large sums of money suddenly moving through an account that had been almost dormant before that!
byegad
Legendary Member
- Location
- NE England
I worked for a Bank for a while, after the money laundering regulations were tightened up. Any large sum transfer from one entity to another has to be 'legitimate'. The teller or as in my case, guy on the other end of the phone, that takes the deposit is expected to query where the cash came from and if they don't and it is later proved hookey, they face a £2k fine and 6 months in gaol, for each offence.
Where I worked we arranged Mortgages and the Flexi-mortgage was a favoured laundering tool. Essentially you borrow a large sum for house purchase, start paying the mortgage and if you have some savings add them to the Flexi part of the deal. This reduces the interest you are paying and can be withdrawn/added to at any time.
By adding a smallish amount regularly then taking it back out in a lump it washes the cash through the bank. I've lost count of the number I referred for investigation as people would take out a £3 000 000 mortgage on a large property in that there Lunnon, then put £2 500 000 into the savings element the next day. If they had the cash for that, why take out a £3 000 000 mortgage?????? But the subtler ones, adding say £9 999 each week then removing a huge lump at a later date, hoped to get away with it. £10k being the then trigger amount for automatic checks. Needless to say, there were other people and computers looking for those avoiding scrutiny by keeping below that limit!
The original post is unclear and hopefully it is merely the post that appears to contravene any law, not the poster.
Where I worked we arranged Mortgages and the Flexi-mortgage was a favoured laundering tool. Essentially you borrow a large sum for house purchase, start paying the mortgage and if you have some savings add them to the Flexi part of the deal. This reduces the interest you are paying and can be withdrawn/added to at any time.
By adding a smallish amount regularly then taking it back out in a lump it washes the cash through the bank. I've lost count of the number I referred for investigation as people would take out a £3 000 000 mortgage on a large property in that there Lunnon, then put £2 500 000 into the savings element the next day. If they had the cash for that, why take out a £3 000 000 mortgage?????? But the subtler ones, adding say £9 999 each week then removing a huge lump at a later date, hoped to get away with it. £10k being the then trigger amount for automatic checks. Needless to say, there were other people and computers looking for those avoiding scrutiny by keeping below that limit!
The original post is unclear and hopefully it is merely the post that appears to contravene any law, not the poster.
I hope you told them it was first 1/3 for selling a Pinarello Dogama, you would be back tomorrow when the buyers turns up with another £2K for the wheels, and finally the end of the week another £2K for handelbars and seat post
Because mortgages are the cheapest way to borrow money for anything provided you have the cash flow to pay off the debt quickly/over a fixed period. The borrowing on mortgage rates over the last few years have been absolutely incredible, the interest on a £3million mortgage loan at 1.5% is only £3000/month. If you borrowed that much from a commercial bank as a 'start up' loan even at 5% the interest is £12k/month, on a higher risk profile borrower so 8% APR thats £20K/month interest. Most half decent 'Entrepreneurs' should be able to return more than £3k/month on a £3million initial investment/asset etc, where as returning more than £12k/month is a different matter.
Ofcourse the difference is the mortgage debt is secured on the house, so if your plans for the money doesn't work out you will loss the house, where as defaulting on a commercial loan has less immediate consequences.
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Bazzer
Setting the controls for the heart of the sun.
- Location
- On the edge of reality
nickyboy
Norven Mankey
- Location
- You want hills? We got hills
The issue you have is that your cash is (a) owned by your sister (b) in the form of shares
Taking each point in turn:
The assets are hers. If ownership can pass to you and she lives another 7 years, it's fine. However, if she doesn't, and her estate is above the threshold for Inheritance Tax, it is going to cause a problem in that her estate would have to pay the tax on the transfer. However, if her estate is likely below IHT thresholds it is no big deal
As the assets are in the form of shares this complicates matters. If they are specific shareholdings that she holds personally, she can transfer beneficial ownership to you, no major issues with that. However, if they are invested via some fund or whatever, these can't just be transferred to you. The shareholdings would have to be liquidated and the cash transferred. In liquidating this may give rise to Capital Gains Tax liability (although if it's only £40k invested it probably won't)
If I were you I would ask her to liquidate the investments into cash and get her to transfer the cash to you. There may be Anti Money Laundering provisions to consider with the transfer but as you're a family member that shouldn't be an issue
Taking each point in turn:
The assets are hers. If ownership can pass to you and she lives another 7 years, it's fine. However, if she doesn't, and her estate is above the threshold for Inheritance Tax, it is going to cause a problem in that her estate would have to pay the tax on the transfer. However, if her estate is likely below IHT thresholds it is no big deal
As the assets are in the form of shares this complicates matters. If they are specific shareholdings that she holds personally, she can transfer beneficial ownership to you, no major issues with that. However, if they are invested via some fund or whatever, these can't just be transferred to you. The shareholdings would have to be liquidated and the cash transferred. In liquidating this may give rise to Capital Gains Tax liability (although if it's only £40k invested it probably won't)
If I were you I would ask her to liquidate the investments into cash and get her to transfer the cash to you. There may be Anti Money Laundering provisions to consider with the transfer but as you're a family member that shouldn't be an issue
