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Where Taxpayers and Advisers Meet

Question on transferring a large sum to my retired dad' account

ABap
Posts:2
Joined:Tue May 05, 2020 10:22 am
Question on transferring a large sum to my retired dad' account

Postby ABap » Tue May 05, 2020 10:34 am

Hello, I'm new to the forum and very much a layman so I'm really hoping someone could be kind enough to help or give me some pointers.

I'm a UK citizen but live in Spain and the rest of my family live in the UK. My brother and I sold a flat in the UK and my share of the money is sitting in his UK bank account. I want him to transfer around £120K to my Spanish bank in order for me to pay off my mortgage for my flat in Spain, but if he does it from his account it will cost around £12K in fees. My dad however is retired and therefore if the money was transferred from his account the fees would be significantly less. The question therefore if my brother transferred such a large sum of money to my Dad's account to be transferred to mine, would it then be considered as income for my Dad by the Tax office and need to be taxed or affect his retirement status?

I hope my question makes sense and if you are aware of any knock-on complications with my idea please let me know.

Thank you so much

pawncob
Posts:5090
Joined:Wed Aug 06, 2008 4:06 pm
Location:West Sussex

Re: Question on transferring a large sum to my retired dad' account

Postby pawncob » Tue May 05, 2020 3:53 pm

Why the disparity in fees? (and why are transfer fees 10% if it's legit money?)
As long as the transfer to dad is evidenced by a letter to show that it's NOT a gift to him, there are no UK tax implications ASSUMING that all UK liabilities have been already settled.
With a pinch of salt take what I say, but don't exceed your RDA

ABap
Posts:2
Joined:Tue May 05, 2020 10:22 am

Re: Question on transferring a large sum to my retired dad' account

Postby ABap » Tue May 05, 2020 8:55 pm

Thanks for replying pawncob. Sorry my bad I didn't mean "fees", I meant a tax the Spanish government charge for family members giving money to other family members. It is vastly cheaper if it's given by a parent than a sibling, thus the need for the transfer from my dad's account rather than my brother's. However if there is no issue with his tax status for having such a large amount come into his account then I can relax, and yes he has no issues with other liabilities. So should my brother write a letter to my dad as evidence that it's not a gift to him?

pawncob
Posts:5090
Joined:Wed Aug 06, 2008 4:06 pm
Location:West Sussex

Re: Question on transferring a large sum to my retired dad' account

Postby pawncob » Wed May 06, 2020 11:18 am

I'd advise it.
With a pinch of salt take what I say, but don't exceed your RDA

AGoodman
Posts:1738
Joined:Fri May 16, 2014 3:47 pm

Re: Question on transferring a large sum to my retired dad' account

Postby AGoodman » Wed May 06, 2020 2:33 pm

Counterpoint: I don't know anything about Spanish tax but you did say this was your money, so it isn't a gift from your father or brother. It may be worse to make any suggestion that this is a gift from your father when it actually comes from a sale of your property. That is the sort of thing that gets tax authorities very upset.

Presumably the property sale docs show that you sold a property for £x so you can evidence that this sum is x/2 if the Spanish authorities ask.

Also presumably you have made the any necessary filings/paid the tax in Spain relating to the sale? Receiving the proceeds should be entirely consistent.


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