BRITISH Inheritance from the UK United Kingdom or - GB

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To: [email protected] 
Sent: Wednesday, June 16, 2004 6:28 AM
Subject: Inheritance
Dear David:
My sister (resident in England) and I inherited my mother's house upon her death.  The house is now in the process of being sold and my share will be approximately $225,000.
My question is will I have to pay tax on this amount when the money is sent to me in Canada?  I am a Canadian resident.
Thank you for your help.  
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david ingram replies:
>From your email address, I am honoured that you would ask me the question.

However, the answer is simple.
Any taxes (inheritance or otherwise) will be paid by your mother's estate in England.
Any money you receive in Canada will be tax free.
Take it and pay down your mortgage if you have one even if you have to pay a penalty.  Then, if you want to make an investment, borrow the money against the new found equity in your home.  That way the mortgage interest will be deductible.
If you do not have a home now, this is your chance to buy one.
Remember that if you are paying $1,000 a month rent, you have to earn $1,500 and pay at least $500 a month in taxes, etc, to have $1,000 left over to pay the $1,000 rent.  In other words, you have to earn $18,000 to pay $12,000 rent.
If you tried to do it with invested money at 4%, you would need $400,000 in the bank at 4%.
4% of $450,000 would get you $18,000 on which you would have to pay about $6,000 of tax to have $12,000 left to pay the rent.  
Hope this helps.
Although I no longer have anything to do wioth the office and have not since 1997,  there is still an office with my name on it in Ottawa at 329 Waverly (corner of O'Connor) . Robert Veillette is the owner / manager.
Answers to this and other similar  questions can be obtained free on Air every Sunday morning.
Every Sunday at 9:00 AM on 600AM in Vancouver, Fred Snyder of Cartier Partners and I will be hosting an INFOMERCIAL but LIVE talk show called "ITS YOUR MONEY"
Those outside of the Lower Mainland will be able to listen on the internet at
www.600AM.com 
Local phone calls to (604) 280-0600 - Long distance calls to 1-866-778-0600. 
Old shows are archived at the site.
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