Your recipient may avoid taxes on your money transfer depending on your nationality and where you live. Even so, it’s your job to report large amounts to the IRS — and you may be on the hook for a gift tax.
How the UK regulates large remittances
While the UK doesn’t charge a gift tax, it does impose inheritance taxes on large gifts. Whether your recipient pays taxes on that gift depends on factors that include:
Your nationality.
Your residency.
Whether the recipient is a charity or political party.
Your gift is more than $425,000.
The last point is related to the UK’s inheritance tax laws. Our research suggests that large money transfers may fall under these regulations. But given the complexity of tax laws, talk with a professional to learn whether taxes apply to your situation.
What are the penalties in the UK if my recipient fails to file?
Our research indicates that past due taxes may attract interest if the transfer falls under the UK’s inheritance laws. And those interest rates can fluctuate with the market.
To understand the specific penalties that apply if your recipient fails to file, talk with a tax professional.
Do I have to report large remittances out of the US?
It’s likely that you’ll need to file a form with the IRS after transferring a large amount of money to the UK. Anyone who gifts more than $17,000, has a foreign account with a value of $10,000 or more or transacts business totalling more than $10,000 in a year may need to file remittances with the IRS.
Shaving a couple of dollars off your ten-grand transfer may not save it from being reported: Banks and transfer specialists are required to report transfers of $10,000 or more to the IRS, but they sometimes report remittances as low as $1,000.
How much money can I send to the UK?
While you won’t hit a legal limit when it comes to sending money to the UK, financial institutions and transfer services may cap how much you can send at a time.
Digital money specialists like the commission-free Xe transfer allow transfers of any amount for select customers, no matter how large.
How can my recipient in the UK get the money?
The UK offers flexible money transfer options. Depending on the transfer company you use, you can set up your transfer for cash pickup, a bank deposit, a deposit to a mobile wallet or an international money order delivery.
Cash pickups may be limited outside of major cities. Read our guide on transferring money to the UK for details on sending and receiving funds.
The UK appears to have only one tax law that could affect your large money transfer — and it may not even apply. Learn more about rates, fees and turnaround to the UK in our comprehensive guide to money transfers.
Frequently asked questions
The inheritance tax applies at different rates that depend on the time of the gift and the gifter’s death.
The rates below are current as of February 2019.
Years gift given before death
Inheritance tax owed
Less than 3 years
40%
3–4 years
32%
4–5 years
24%
5–6 years
16%
6–7 years
8%
7+ years
0%
You can pay an inheritance tax in the UK:
Online or by telephone
CHAPS or Bac
At a bank or building society
By check through the mail
If you’re granted confirmation, representation or probate, you can also pay through:
Accounts belonging to the deceased.
National Savings and Investments and government stock the deceased own
Likely, yes. You can avoid penalties in select cases — for example, if there’s a reasonable cause behind your failure to file. Talk to a tax professional to learn whether your situation qualifies for an exception.
Rhys Subitch is a personal finance editor at Bankrate and former loans editor at Finder, specializing in consumer and business lending. Rhys has nearly a decade of experience researching, editing, and writing for startups, Fortune 500 companies, universities and websites. They hold a BA in sociology and a certificate of editing from the University of Washington. See full bio
Rhys's expertise
Rhys has written 39 Finder guides across topics including:
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