A question about : Is it legal to transfer money from abroad through private market?
My parents living abroad gave us money to put towards the deposit for the house. However that country has lots of restrictions on sending money abroad. We're found a service which can help us find people who want to send money the other way (UK - that country).
The way it works is I send my parents' money abroad to someone within that country, then someone sends me the equivalent amount in Pounds in UK (means money still in borders of both countries)
Assume that this is totally trustworthy, is it legal to receive money from anonymous sources from UK?
I do have bank statement in that country in my name to prove that I have that amount of money & the source of money is legal.
Also when I mortgage, would they question source of funds? If I explain to them the way I have transferred it, would they accept it as a legal way?
Thank you very much in advance!
Best answers:
- It should be legal, although there is quite a lot to go wrong...
You would not be receiving money from an anonymous source, but from a specific person. That person is free to give you (or anyone) their money, and may choose to mention that they are doing so because your parents are themselves giving money to someone in the country where your parents live. - Yes I could either receive it by cash in UK, or through bank transfer. But I will try to get money through bank transfer rather than cash, so that I could chase name and account of the person who send money to me.
I know it's such a pain and things could go wrong. But I will only transfer small amount at a time to be on safe side.
When I mortgage, would the bank or solicitor ask in details where and how those money come from? - I don't understand your question.
You state your parents gave(i.e. past tense) you money.
Do you mean intend to give you money?
There is nothing illegal in receiving money from someone in UK, or from abroad. e.g. Many thousands get rent for properties they own.
However if the foreign country has restrictions on your parents sending money to UK, presumably it would be 'illegal' under the laws of that country to circumvent the regulations.
The only interest the UK could have is money laundering and/or tax implications. - My parents deposited the money to my bank account in that country so they have given me money, but money is abroad.
It shouldn't be illegal in that country because they have restrictions of sending money out of the country, while I am not sending any money out, I'm sending money to someone within borders.
Tax implications: I think I don't have to pay tax if I receive gift money from my parents. Do I have to pay tax for money received from someone in UK?
Yes there's a chance that the people who send me money in UK may try to avoid tax or do money laundering, but that should be their problem not mine ? - Ensure that you receive the money in the UK by bank transfer or a similar traceable method. If you attempt to buy a house and pay a ten thousand pound deposit in cash, you might face problems. The money will have to go into your bank account, and if you pay in a large amount of cash you will need to give the bank a full explanation.
There is not much sense doing many small transfers, and you might have to pay a fee for each transfer. You need to make sure that you can trust the other people involved. And there ought not to be any tax to pay. - Thanks Voyager
I'm applying for a mortgage now. If I transfer money by the way stated above, how likely that solicitor or bank to question this money?
I have bank statement in foreign country showing that I have those money, bank transfer showing that money goes out from foreign account and an equivalent amount of Pounds going in my UK account. I would also ask the person who send me money to sign a paper saying that they have received X money in foreign currency, in exchange for Y amount in GBP. Is it gonna be sufficient in case they ask?
Does solicitor always check the source of funds and how it is transferred or occasionally?
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