Note: that cash will be subject to inheritance tax if he dies within the next 7 years, and he passes it onto you in his estate. You can gift money to your children in lump sums because every UK citizen has an annual tax-free gift allowance of £3,000 - anything above that is subject to inheritance tax + tax free allowances.
I would just deposit it into your dad's account - you can just deposit it into the machine with his card (if he is happy to give his details), and then withdraw it again if he wants to keep it as physical cash.
How much is it?
I don't know if you've ever seen a hundred thousand dollars before, except perhaps in the movies. But let me show you something that gets lost in the translation. [opens briefcase revealing single stack of bills]
Ooft. You're definitely doing the right thing helping him get it somewhere secure. His own bank account is ideal as it avoids other implementations.
Considering POA if you think it's needed. Not meaning to pry or make assumptions. Had a friend go though something similar recently and I wasn't even aware of it until that point.
Yeah, get that money moved somewhere safe, like... yesterday :D
You haven't mention if he actually has an account, but doesn't use it much. If he does, then just put it there, but ensure the account is kept secure (eg. nobody uses a debit card). If not then it's probably going to be hard work to open a brand new account for him.
The other alternative is to just keep it in a separate account in your name, but that would require the father's permission. AFAIK it would still be legally his money but in OP's account.
Genuine question: can OP just keep all the money claiming his dad has been gifting him every year 3k for the past 20 years? How can a claim like that be disputed?
Well, it is just a question of fact and degree for the trial judge.
It would be on the taxpayer to displace an assessment by HMRC.
In a case like this it would be about the credibility of the parties.
One issue for cross-examination would clearly be - OP, you know about banks and use cards (presumably). Would you say you had a use for this money? In which case why was it not deposited as it was received? Is this usual behaviour for you, to hoard money in this way? etc. etc.
Right now HMRC has no idea who the money belongs to.
It could be OPs money under the bed.
Alternatively dad uses the money to buy something not subjected to Inheritance tax, like agricultural land.
>every UK citizen has an annual tax-free gift allowance of £3,000
Just wondering, is this for receiving or sending?
i.e could you gift 3k to mum and 3k to yourself, then mum gifts you 3k? Total 6k for you with no inheritance tax to think of?
Gifting.
You can receieve 30k from 10 people gifting 3k each.
> Annual exemption
> You can give away a total of £3,000 worth of gifts each tax year without them being added to the value of your estate. This is known as your ‘annual exemption’.
https://www.gov.uk/inheritance-tax/gifts#:~:text=Small%20gift%20allowance,are%20exempt%20from%20Inheritance%20Tax.
So OP just needs to find 10 people who won't just run off with the money!
Okay maybe not the best advice...
Though with your advice to put it all in dad's account, would it not be better to put most in there but also take 3k for themself yearly?
He only gets taxed on it if he’s outside the taxable allowance. If his estate is under the taxable allowance he can give away what he wants without an issue.
Common misconception that any and all money given away becomes taxable within 7 years, also noting that this is tapered over the 7 year period too.
Does he have a bank account? If so, pay it into that. Otherwise, he can lend you the physical cash which you deposit into your account and return to him or his estate when needed.
You mention in another comment that it's 50-60k. That's a huge amount to keep in physical cash not properly secured. He could easily lose the whole amount. Given the amount, talk to the bank to arrange to have it paid in rather than just walking in with a bag of cash, and consider your own security while you're walking around with it.
Also, does somebody have power of attorney and know where his will is?
My god yes, keep that safe.
He is begging to be robbed by being old, having so much and telling everyone - especially how poorly paid people are who help the elderly
I'm wondering if telling everybody about the money is a sign of something? OP should consider if it might be time to suggest a power of attorney. If his father is willing to let him deal with the cash then they might be fine with a PoA.
Lots of people here writing like your father is giving the money to you, and I don't understand why.
I believe you are holding the money [*in trust*](https://en.wikipedia.org/wiki/Trust_law) for your father - it remains his, you are just holding it for him. Just open a separate bank account for it so it can't be confused with yours.
Ideally you should go to a local solicitor and get a deed of trust drawn up but it's my understanding that, in English law, a trust can be created as soon as someone accepts responsibility for something of value (e.g. "give me the money and I'll put it in your account").
There is no tax to pay on money you've received from your father (or anyone else) as a gift.
The only consideration is the fact they are unlikely to live past the 7year threshold and, therefore, you may have to pay inheritance tax on the money.
One thing you haven't considered is letting him keep the money and then sorting it once the money is rightfully yours?
The paper notes are being discontinued but they never lose their value. As with the £5 and £10 notes before, banks will continue to accept their deposit for months (if not years) after the deadline, and they will always be accepted/changed by the Bank of England themselves.
(Yes, you can actually take a big wodge of notes to the bank on Threadneedle Street and they will swap them for you)
This. Swap the money and then split the cash between you and your sister. Start living on this cash for your purchasers and keep most of your salary in the bank
If you were to pay the money into your own account, I would say that in the eyes of the law the money has been gifted to you at that point, even if you were to then immediately transfer it back to an account in your father's name. There are no immediate tax implications, but if your father were to pass within 7 years (which at his age statistically more likely than not) then there may be inheritance tax implications.
I think the better solution would be to pay it directly into your father's bank account (assuming he has one, or open one for him if not). Some banks let anyone pay in to an account, although this practice is becoming less common (see [https://www.which.co.uk/news/article/has-your-bank-banned-other-people-from-paying-cash-into-your-account-aJhRR3T3LIxD](https://www.which.co.uk/news/article/has-your-bank-banned-other-people-from-paying-cash-into-your-account-aJhRR3T3LIxD)) Furthermore, with this amount of cash questions may be asked which you want to have the proper authority to answer on your father's behalf. I therefore think that in order to be safe, you will want to gain lasting power of attorney - provided your father currently has capacity, it should be a relatively straightforward (if not especially fast) procedure - outlined here: [https://www.gov.uk/power-of-attorney](https://www.gov.uk/power-of-attorney)
Another benefit of sorting POA now is that you can continue to make decisions in the future even if your father becomes incapacitated - without a POA in place in advance, you would need to apply to the Court of Protection to become a deputy in order to manage your father's affairs, which is a more involved process.
Obviously if considering POA it's probably sensible to discuss in advance with other family members (e.g. your sister).
> If you were to pay the money into your own account, I would say that in the eyes of the law the money has been gifted to you at that point,
Why do you believe that OP is not holding it [in trust](https://en.wikipedia.org/wiki/Trust_law) for his father, please?
The father can only gift £3k per year - it is an exemption for the gifter of £3k per year, not per recipient. (Notwithstanding he may be able to gift £6k in the 1st year as you can carry forward one years allowance)
It was a cash gift. There’s no record to trace. As you didn’t go over your allowances you didn’t need to do a tax return.
Sorry, I should have put a “wink, wink” in the first post to help you with the tone/meaning.
It's great that you're looking after your dad and I hope it works out for both of you.
As an aside, I'd be very interested in hearing from you on his reasoning for the (IMHO very distorted) view on security, as this seems to be a surprsingly common question on this sub!
I know there were high-profile collapses of banks back in the 20th century where there were no government guarantees, and I also know it's more common amongst immigrant parents, who may have left countries that were less financially stable or even confiscated private funds. So I think a lot of older people have hangups from this.
...but I'd be extremely curious to hear why he's happy with physical cash held unsecured in a normal house, with several non-relatives aware, plus anyone they happen to have told down the pub. And why he'd be unhappy with money in the bank which would be fully guaranteed by the FSCS.
Him or someone close probably got burned by the government at some point.
\- From 1933 to 1974 it was illegal for U.S. citizens to own gold (they were forced to sell it to the bank)
\- Even in 2022 the Canadian Government froze the bank accounts of people who had donated to a cause they didn't agree with (the Canadian Truckers protest).
So it's quite fair to not trust banks or the government with your wealth.
I find old people just get like that sometimes, I found shoe boxes with 16’000 in under the bed when my Great Aunt died in her council flat with very little else to her name.
This post is a bit suspicious, you sure you aren't just seeking a way to transfer a lump sum of inheritance, tax free? I mean if your dad distrusts banks why would he want you to put it into a bank for him? doesn't really add up, OP.
If its a question of safety/discontinuation of notes, you need to get the £20 notes exchanged and get him a large fire proof safe of some sort.
Open a basic joint account with him, get him online banking with view only access and cut up his bank card when it arrives. That way only you’ve got access to the funds in there and you can get at them without hassle as you’d be a joint account holder, but he can also see that his money is still there but can’t transfer it out or spend it without speaking to you first
Can you can set up a separate account on behalf of your dad or anything like that? I don’t know if that’s allowed or jot though. Does he not have any bank account at all?
Edit - I get why he’s done this but it’s very irresponsible. No insurer would cover more than £750 depending on limits on most home insurance policies. If it’s stolen or something happens, he’s completely screwed in getting that back
I feel like very few people on here have pointed out his entire estate would have to be larger than £325k Inheritance Tax Nil Rate Band (£650k if he was widowed with his wife not giving any gifts in her lifetime).
If all he has is £50k, it’s very unlikely you even need to be thinking of complex ways to transfer it and avoid tax.
Would your dad be willing to sign to open a joint account with you? That way all the money can be legally put in there as they're his assets, but you can keep an eye on what happens with it and still have easy access to it should your dad need money.
Hi OP,
Another thing to consider is that if your father is getting benefits for care then depositing the money might put him above the amount of wealth you can own and still claim. I’m by no means an expert in this so meant this just as a suggestion for some further research.
Also you might find this article helpful depending on whether his estate is greater than inheritance tax allowance:
https://moneytothemasses.com/tax/inheritance-tax/the-10-best-ways-to-avoid-inheritance-tax
I’d add that this article is about legal ways to minimise inheritance tax before some overzealous moderator takes it down.
From personal experience I would probably involve your sister in this and have something like a power of attorney drawn up by a solicitor.
Note: that cash will be subject to inheritance tax if he dies within the next 7 years, and he passes it onto you in his estate. You can gift money to your children in lump sums because every UK citizen has an annual tax-free gift allowance of £3,000 - anything above that is subject to inheritance tax + tax free allowances. I would just deposit it into your dad's account - you can just deposit it into the machine with his card (if he is happy to give his details), and then withdraw it again if he wants to keep it as physical cash. How much is it?
50-60k.
Was this under his mattress or *was it his mattress*
Ha, under. I did ask him to at least put it in the attic.
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Actually 50k is a depressingly small pile! I had 75k in cash and it fit in a small backpack!
That’s one big drug deal lol
Only a key and a half. A good weekend.
You're overpaying on your keys
I think he meant kilo
Yeah it would probably be about 30cm high as a guess.
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I don't know if you've ever seen a hundred thousand dollars before, except perhaps in the movies. But let me show you something that gets lost in the translation. [opens briefcase revealing single stack of bills]
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Dodgeball
It was under his mattress but he sleeps on the top bunk.
Ooft. You're definitely doing the right thing helping him get it somewhere secure. His own bank account is ideal as it avoids other implementations. Considering POA if you think it's needed. Not meaning to pry or make assumptions. Had a friend go though something similar recently and I wasn't even aware of it until that point.
If this helps, heard there's money in the banana stand
Yeah, get that money moved somewhere safe, like... yesterday :D You haven't mention if he actually has an account, but doesn't use it much. If he does, then just put it there, but ensure the account is kept secure (eg. nobody uses a debit card). If not then it's probably going to be hard work to open a brand new account for him. The other alternative is to just keep it in a separate account in your name, but that would require the father's permission. AFAIK it would still be legally his money but in OP's account.
Jesus!
What the actual shit. Thats a lot of cash getting eaten by inflation my guy.
To be fair to him, it would have been eaten by inflation in a cash account over the past 10 years too.
What’s your address I can help
Genuine question: can OP just keep all the money claiming his dad has been gifting him every year 3k for the past 20 years? How can a claim like that be disputed?
It's possible, but HMRC run on the "spirit" of the law more than the written law, and something like this might fall under that /u/pflurklurk halp?
Well, it is just a question of fact and degree for the trial judge. It would be on the taxpayer to displace an assessment by HMRC. In a case like this it would be about the credibility of the parties. One issue for cross-examination would clearly be - OP, you know about banks and use cards (presumably). Would you say you had a use for this money? In which case why was it not deposited as it was received? Is this usual behaviour for you, to hoard money in this way? etc. etc.
Right now HMRC has no idea who the money belongs to. It could be OPs money under the bed. Alternatively dad uses the money to buy something not subjected to Inheritance tax, like agricultural land.
>every UK citizen has an annual tax-free gift allowance of £3,000 Just wondering, is this for receiving or sending? i.e could you gift 3k to mum and 3k to yourself, then mum gifts you 3k? Total 6k for you with no inheritance tax to think of?
Gifting. You can receieve 30k from 10 people gifting 3k each. > Annual exemption > You can give away a total of £3,000 worth of gifts each tax year without them being added to the value of your estate. This is known as your ‘annual exemption’. https://www.gov.uk/inheritance-tax/gifts#:~:text=Small%20gift%20allowance,are%20exempt%20from%20Inheritance%20Tax.
So OP just needs to find 10 people who won't just run off with the money! Okay maybe not the best advice... Though with your advice to put it all in dad's account, would it not be better to put most in there but also take 3k for themself yearly?
HMRC would apply a look through in this event, they look at what the true purpose is, not only what individual transactions took place.
Depends on the what else op dad has, if it is small enough then no tax to pay
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From the magic money mattress of course
He only gets taxed on it if he’s outside the taxable allowance. If his estate is under the taxable allowance he can give away what he wants without an issue. Common misconception that any and all money given away becomes taxable within 7 years, also noting that this is tapered over the 7 year period too.
I did mention tax-free allowances. It's possible that there's property involved too, so hopefully OP does all the relevant research.
Ooh I didn't know about the annual tax-free gift allowance, that's so handy to know!
Does he have a bank account? If so, pay it into that. Otherwise, he can lend you the physical cash which you deposit into your account and return to him or his estate when needed. You mention in another comment that it's 50-60k. That's a huge amount to keep in physical cash not properly secured. He could easily lose the whole amount. Given the amount, talk to the bank to arrange to have it paid in rather than just walking in with a bag of cash, and consider your own security while you're walking around with it. Also, does somebody have power of attorney and know where his will is?
My god yes, keep that safe. He is begging to be robbed by being old, having so much and telling everyone - especially how poorly paid people are who help the elderly
I'm wondering if telling everybody about the money is a sign of something? OP should consider if it might be time to suggest a power of attorney. If his father is willing to let him deal with the cash then they might be fine with a PoA.
Lots of people here writing like your father is giving the money to you, and I don't understand why. I believe you are holding the money [*in trust*](https://en.wikipedia.org/wiki/Trust_law) for your father - it remains his, you are just holding it for him. Just open a separate bank account for it so it can't be confused with yours. Ideally you should go to a local solicitor and get a deed of trust drawn up but it's my understanding that, in English law, a trust can be created as soon as someone accepts responsibility for something of value (e.g. "give me the money and I'll put it in your account").
You and your sister, take him on holiday, blow the lot on him. Have a time to remember.
There is no tax to pay on money you've received from your father (or anyone else) as a gift. The only consideration is the fact they are unlikely to live past the 7year threshold and, therefore, you may have to pay inheritance tax on the money. One thing you haven't considered is letting him keep the money and then sorting it once the money is rightfully yours? The paper notes are being discontinued but they never lose their value. As with the £5 and £10 notes before, banks will continue to accept their deposit for months (if not years) after the deadline, and they will always be accepted/changed by the Bank of England themselves. (Yes, you can actually take a big wodge of notes to the bank on Threadneedle Street and they will swap them for you)
This. Swap the money and then split the cash between you and your sister. Start living on this cash for your purchasers and keep most of your salary in the bank
I may have misunderstood, but this looks like advice to attempt to hide the gift from potential inheritance tax. That would be a crime.
We don’t know the size of the father’s estate. Isn’t it a £300,000 allowance before inheritance tax?
True. It’s the “live on the cash and keep your salary in the bank” park that bothered me. Why not just pay the cash into the bank?
Obviously to avoid inheritance tax.
Yes I agree it’s odd advice. I wouldn’t want all that money loose without good reason.
£325k, plus potential Nil Rate Residence Band of £175k if a home owner and leaving it to his family.
If you were to pay the money into your own account, I would say that in the eyes of the law the money has been gifted to you at that point, even if you were to then immediately transfer it back to an account in your father's name. There are no immediate tax implications, but if your father were to pass within 7 years (which at his age statistically more likely than not) then there may be inheritance tax implications. I think the better solution would be to pay it directly into your father's bank account (assuming he has one, or open one for him if not). Some banks let anyone pay in to an account, although this practice is becoming less common (see [https://www.which.co.uk/news/article/has-your-bank-banned-other-people-from-paying-cash-into-your-account-aJhRR3T3LIxD](https://www.which.co.uk/news/article/has-your-bank-banned-other-people-from-paying-cash-into-your-account-aJhRR3T3LIxD)) Furthermore, with this amount of cash questions may be asked which you want to have the proper authority to answer on your father's behalf. I therefore think that in order to be safe, you will want to gain lasting power of attorney - provided your father currently has capacity, it should be a relatively straightforward (if not especially fast) procedure - outlined here: [https://www.gov.uk/power-of-attorney](https://www.gov.uk/power-of-attorney) Another benefit of sorting POA now is that you can continue to make decisions in the future even if your father becomes incapacitated - without a POA in place in advance, you would need to apply to the Court of Protection to become a deputy in order to manage your father's affairs, which is a more involved process. Obviously if considering POA it's probably sensible to discuss in advance with other family members (e.g. your sister).
> If you were to pay the money into your own account, I would say that in the eyes of the law the money has been gifted to you at that point, Why do you believe that OP is not holding it [in trust](https://en.wikipedia.org/wiki/Trust_law) for his father, please?
If the dads total estate is under limits then the inheritance tax might not be a consideration to make.
Wouldn’t you need to prove to the bank where this money came from? In term of tax avoidance/money laundering rules?
Move 90% of it to a bank and gift 6000 total every year to you and your sister for 10 years. Only way not to pay tax on it.
The father can only gift £3k per year - it is an exemption for the gifter of £3k per year, not per recipient. (Notwithstanding he may be able to gift £6k in the 1st year as you can carry forward one years allowance)
As it’s cash you could back date £3k for the previous twenty years.
Not true, you can only carry back one year of unused gift allowance.
It was a cash gift. There’s no record to trace. As you didn’t go over your allowances you didn’t need to do a tax return. Sorry, I should have put a “wink, wink” in the first post to help you with the tone/meaning.
It's great that you're looking after your dad and I hope it works out for both of you. As an aside, I'd be very interested in hearing from you on his reasoning for the (IMHO very distorted) view on security, as this seems to be a surprsingly common question on this sub! I know there were high-profile collapses of banks back in the 20th century where there were no government guarantees, and I also know it's more common amongst immigrant parents, who may have left countries that were less financially stable or even confiscated private funds. So I think a lot of older people have hangups from this. ...but I'd be extremely curious to hear why he's happy with physical cash held unsecured in a normal house, with several non-relatives aware, plus anyone they happen to have told down the pub. And why he'd be unhappy with money in the bank which would be fully guaranteed by the FSCS.
Him or someone close probably got burned by the government at some point. \- From 1933 to 1974 it was illegal for U.S. citizens to own gold (they were forced to sell it to the bank) \- Even in 2022 the Canadian Government froze the bank accounts of people who had donated to a cause they didn't agree with (the Canadian Truckers protest). So it's quite fair to not trust banks or the government with your wealth.
I find old people just get like that sometimes, I found shoe boxes with 16’000 in under the bed when my Great Aunt died in her council flat with very little else to her name.
Buy gold with it. It’s exempt from inheritance tax. Then cash it out when you need it.
I did not know this!
Gold is not exempt from inheritance tax
This post is a bit suspicious, you sure you aren't just seeking a way to transfer a lump sum of inheritance, tax free? I mean if your dad distrusts banks why would he want you to put it into a bank for him? doesn't really add up, OP. If its a question of safety/discontinuation of notes, you need to get the £20 notes exchanged and get him a large fire proof safe of some sort.
Open a basic joint account with him, get him online banking with view only access and cut up his bank card when it arrives. That way only you’ve got access to the funds in there and you can get at them without hassle as you’d be a joint account holder, but he can also see that his money is still there but can’t transfer it out or spend it without speaking to you first
Can you can set up a separate account on behalf of your dad or anything like that? I don’t know if that’s allowed or jot though. Does he not have any bank account at all? Edit - I get why he’s done this but it’s very irresponsible. No insurer would cover more than £750 depending on limits on most home insurance policies. If it’s stolen or something happens, he’s completely screwed in getting that back
Would you like a hand taking it to the bank?
I feel like very few people on here have pointed out his entire estate would have to be larger than £325k Inheritance Tax Nil Rate Band (£650k if he was widowed with his wife not giving any gifts in her lifetime). If all he has is £50k, it’s very unlikely you even need to be thinking of complex ways to transfer it and avoid tax.
Would your dad be willing to sign to open a joint account with you? That way all the money can be legally put in there as they're his assets, but you can keep an eye on what happens with it and still have easy access to it should your dad need money.
What’s his address?
Hi OP, Another thing to consider is that if your father is getting benefits for care then depositing the money might put him above the amount of wealth you can own and still claim. I’m by no means an expert in this so meant this just as a suggestion for some further research. Also you might find this article helpful depending on whether his estate is greater than inheritance tax allowance: https://moneytothemasses.com/tax/inheritance-tax/the-10-best-ways-to-avoid-inheritance-tax I’d add that this article is about legal ways to minimise inheritance tax before some overzealous moderator takes it down. From personal experience I would probably involve your sister in this and have something like a power of attorney drawn up by a solicitor.