Gift from US citizen to non US citizen

[heron]

My wife is american and has lived in the UK over 15 yrs. She does not work in the UK.

What are the tax implications of transfers between husband and wife? I know in the UK there are no implications (these are all UK assets or cash) but have heard there are 'gift' tax issues with US citizens (should she agree to transfer money back to me).

[TaxationWeb@BritishA]

If she recieves a gift from you (in excess of this year's limitation of $114,000 or so), she must report the reciept of this gift, but she isn't taxed on it.

If she gives you a gift (in exess of the annual limitation), it triggers a gift tax return. Amounts in excess of the annual limitation reduce the amount of her tax-free estate when she dies. In addition, if the gift is in excess of the annual limit PLUS whatever remains of her lifetime limit of $1,000,000, then there is gift tax due as well.

As your wife is a US citizen, she may not be domiciled in the UK. If she isn't domiciled in the UK, then there are UK gift tax considerations as well.