Tax on monetary gift from abroad

[rkl]

I hope someone might be able to offer advice on the following please:

I am a UK citizen and a family friend (citizen of Hong Kong) if offering to make me a gift of up to £1m to start a business. Would their be any tax to pay on this in the UK if it were to be paid into my personal bank account? Could i then transfer it into the account of a limited company without incurring a tax penalty?

Any help would be much appreciated.

[ensigntaxation]

Hi RKL,

I could do with a few family friends like that!

No tax on the gift in the UK. Your friend might want to check that no IHT / estate issues at his end (though what I remember from HK, prob not.)

Subscribing for shares in a NewCo is not taxable. From a commercial perspective, whether you would inject the full £1m in this way is a different matter.

If any of the cash sits in a bank account and produces interest then that is taxable.

Good luck with the business. Any Qs then let me know.

Cheers
Andy

[maths]

To avoid any UK inheritance tax issues it is important that the monies are not transferred from a UK bank account of your family friend.