The Million Pound Drop,4/10/12

[robert551069]

Two cousins won a record £300,000 last night. They said they are going to share it with their large family. I suspect that will be a bigger problem than winning the money.

[Anngel]

Is it taxable, if it's winnings? They never mention that!!

[ummmm]

I think it's tax free.

[Anngel]

£300,000 will not go very far in a large family. Would the recipients be taxed if a car was bought as a gift?

[ummmm]

No.

[THECORBYLOON]

It may be tax-free for the winners but if they give any of it away and they die within seven years, there will be tax payable on that amount.

[ummmm]

Even on small amounts?

[THECORBYLOON]

The tax is payable if the estate is worth more than £325,000 and there is not enough left in the estate to pay the tax. The actual rate of the tax paid reduces as time goes by and it's unlikely that folk would have to pay it, it's more likely if folk have won millions on the lottery but.

[Bazile]

//It may be tax-free for the winners but if they give any of it away and they die within seven years, there will be tax payable on that amount//

Who would be taxed on the amount given away - the person giving or the recipient ?

Has the winner got to keep records for the taxman , of how he disposes of his winnings ?

[THECORBYLOON]

I am not tax expert but as I understand it, if a person's estate is worth more than £325,000 the taxman looks at gifts/donations given in the seven years prior to that death. Tax will be payable either from the estate or from the person who recieved the gift if there is not enough in the estate to cover that amount. There are various different amounts folk can give to others depending upon the relationship to that person and the reason for the gift, spouse, grandparents, whether it's a wedding gift or a birthday present for example,

[Bazile]

So , the benefactor has to keep a record of donations/gifts ?