Quick help needed - How to transfer a large amount of money to China?

[Clayton]

Jan, by giving your wife's mother a house you set a president for future men looking for a Chinese bride, Mother in law is going to brag to everybody how her future son in law gave her a house and now it will be expected of every man and not all of us can afford to do that.
I wish you well Jan, this is just my opinion

Cheers Leeroy

[Robertt S]

Let me just check that I have got this all correct in my head....

Mother wants you to buy a house for her, as payback for the money she spent on her daughters education.

Make no mistake, what you are describing is just that Jan...you and your future wife will NOT own or have legal title to this home.

You are fortunate that you can afford to lose this sort of money, good luck to you, but the principle is dangerously wrong.

Buy the house in your wife's name...period. Give Mother some "red-envelope" money at your wedding......that's what the rest of us did !!!

Jan,
  I would like to add to David E's reply! Unless your wife is an only child, chances are the eldest child or male child gets the mother's home. Any so-called pre-nuptial penned in China can be voided with payments to the correct official, so you should take that into consideration also. I would agree with the others here and say buy momma a washer/dryer, icebox or agree to send monthly stipends to momma. As a side note, my Chinese wife thinks you purchasing the home is not a good idea until after your marriage, then you would have some semblance of spousal rights to the home!   Anyway, Good Luck in whatever your decision is.      Robert

[Jan]

Well I've talked it through with an accountant/lawyer friend of mine. Well family friend but anyway.
It is not possible to do this without paying the "gift tax". Instead I was suggested to change this in to a form of a "Loan" to her. Of course it is only valid at Finland. But this way I don't have to apparently pay anything extra or very little compared to the 8000€ gift tax... And if things go bad. And the daughter continues to stay at Finland... She would still have this "loan" to pay. And the loan can have many complex terms, that enables it to be nullified over time...

She is the only child of that family. And I think I'll agree with you on that, that the house gouse under the daughters name if we get that far.

This is really complicated legally...

We talked about this issue this morning. Was really complicated. But she made it clear that if I don't want to buy a house yet, we don't have to. But it will make things hard with her family for a really long time.
I am hesitant about this. But this is something that the more I think. The more "right" it feels. In the long run this "investment" will pay out really well. Once and if we sell it.

But we agreed to talk more with that accountant/lawyer next week. To figure out a vise plan.

[JohnB]

Considering all the foreign investment into China, I think I would be looking to create a "real property trust" of some sort. If not via a China mainland investment company, then through Hong Kong (I would attempt H.K.). The Trust owns your China house. You own the trust. There is no conflict. Has to be doable in some way.
I think there must be some sort of a Trust vehicle for doing this...the reality can not be a simple singular black hole where all your monies disappear.
wish you the good fortune! that is, keeping it.
regards, John

[Willy The Londoner]

In prinicipal a good idea John. In practise you need to be a Chinese Citizen living in China to own property here.   There are a few cities where a foreigner can own their own home but they are very few.

That is probably why the Chinese are snapping up properties in foreign countries especially the USA where the property market is at a very low ebb. 

Willy

[Mikael_Shim]

Willy has so man good and important points regarding this. And a fact is, when it comes to money you need to watch your back in China.

Sweden should be rather similar to Finland and we have similar tax rules. Transferring roughly 50-60.000rmb from my bank account in Sweden to my bank account in Bank Of China there were no questions asked, no fees beside the wire fees which were about 300sek/rmb (1sek is almost the same as 1rmb). They did however ask at BOC where the money came from and i told them it came from my own private account in Sweden and they were pleased with that for an answer.

For larger transfers, we have a company in Hong Kong now. One client transferred roughly 150.000rmb to our HSBC Business account in Hong Kong. Transferring from our HSBC business account to our private HSBC accounts on mainland China there has never been any problem and never any questions. If the transfers however were made to accounts where the accountholder was a chinese citizen it may be different. The .gov and authorities in China are more then happy that foreigners bring money inside the country, getting large sums out of China mainland is a completely different story and not very easy.

Now you dont have a company in Hong Kong but considering the amount of money you want to bring over perhaps it is a valid option to get one. The total cost including Goverment fees and Professional fees + Bank fees it costed us about 13.000rmb to set up the Ltd in Hong Kong. Of course you have some recurring fees yearly to maintain the company as well.