moving US savings/gifts to UK

I know there are many threads on this topic, but I am not finding answers that apply to my particular situation...

We are thinking of buying a house.  The deposit will come from 3 savings accounts, 1 in the US, one in Ireland, and one here in the UK.

The money in the US account was nearly all wedding gifts + minor interest.  I was a US resident (and citizen) at the time, and my husband had been resident in the UK for about 10 months (Irish citizen).  It is a joint account.

The money in the Irish account is all from a number of gifts from my husband's parents + minor interest.  We were both resident in the UK when gifts were deposited.  The account is in his name only.

I have read that gifts are not taxable in the UK, so I believe that we should be able to transfer this money to our UK account without paying tax?  Or only paying tax on the interest we have accrued while living in the UK?  Though we already paid tax in Ireland on the interest for the Irish account, so maybe just for the US account? 

If no tax is due, how does our bank (Co-op) know this?  Do they automatically deduct tax when the money enters our account, or do they leave it to us to pay HMRC if necessary?  The amounts coming in would be about £12,000 from the US and £28,000 from Ireland.  We could move them in smaller chunks, but it would have to be all during the next 2 months or so.

I do have records of all of the gifts and interest that made up the money in the foreign accounts, as I have used Quicken for years to keep track of our finances.  Would this be sufficient to show the money is from gifts?  If not, how would we prove this?  And in what circumstances would we have to prove this?  Wedding gifts were all deposited immediately after our wedding, so that seems obvious.  Husband's mother is available to confirm that Irish money is from her if necessary.

Finally, a slightly different question: If/when we move to the US in a few years, would we have to pay tax on the money we transfer back to our US account?  Would there be any difference between transferring money to the US that came from the sale of our UK house v. money from the Irish bank account described above and our UK bank account if we don't buy a house? We are still trying to decide whether it is better to rent or buy, and this is just one more cost to consider.

If you use the word "remittance" in your response, please explain, as I do not totally understand what it means!

Thanks very much for your help.

Those are good questions, christine. Hope someone knows the answers (I certainly don't!) Good luck.

I am not a tax Professional..just getting that disclaimer out of the way

Back in 2007, I received $10,000 from my parents to us as a downpayment on a flat in the UK. I did a bank transfer from my parents' US bank to our UK account.  No taxes were taken out by the bank.  I declared the gift on my tax preparation worksheet for my accountant and asked him about it.  He said it was not a problem as it fell under the US threshold and not a problem for the UK either.  I can't remember what he explained for the UK, but no taxes were due to HMRC either.

Fast forward to 2010 - we sold our flat and moved back to the US with the proceeds of that sale.  We declared the sale of the property on our tax filings for the US and UK and paid the appropriate capital gains taxes.  Money from the sale was deposited into UK account and eventually transferred to a US account without declaring anything to the IRS.  The amount transferred to the US was over $10,000.

I am not sure if we should have declared anything when we actually made the transfer from UK back to the US, but I figured that since we had paid income tax or capital gains taxes due on the money, then we were OK.  We'll see if the IRS comes knocking. 

The donor is generally responsible for paying any gift tax, so as the donee there will be no tax when you transfer money to the UK.

When you move the money to the UK you will have to declare tax on any interest to both the UK and the US as you are a US citizen. How much tax you pay to each country will depend on how you organizes your taxes.

If you buy and sell a house in the UK you will have to comply with UK and US regs wrt capital gains.

Thanks!  Very helpful.

We currently don't file taxes in the US, since I have no income and my husband has no US status. (The interest we get is well below the max you can earn without filing.)

In the UK, my husband just pays income tax through his employer.

Thanks!  Very helpful.

We currently don't file taxes in the US, since I have no income and my husband has no US status. (The interest we get is well below the max you can earn without filing.)

In the UK, my husband just pays income tax through his employer.

Do you jointly own the Irish account with your husband? If so you should be filing FBAR. Also how much is in your UK account? That might also require FBAR.

No, the Irish account is in his name only.  The UK ISA is also in his name.  The UK checking account is joint, but no interest there. 

What is FBAR?

I was advised on this forum that any joint accounts could be attributed to his income or mine, our choice.

No, the Irish account is in his name only.  The UK ISA is also in his name.  The UK checking account is joint, but no interest there. 

What is FBAR?

I was advised on this forum that any joint accounts could be attributed to his income or mine, our choice.

It's good that most accounts are not in your name as far as complying with US regulations goes.

FBAR is a form you must file with the US Treasury if you have signature authority over a foreign account with a balance of $10k or greater. If your UK account has ever been over than you must file FBAR. There are fines for not complying.