A simple way to gift funds tax-free every yearby Taxkey Jan 18, 2022 Taxation Capital Acquisitions Tax Income Tax
An individual can receive a gift of up to €3,000 every year from any number of individuals. This may not seem like a lot but it can make a considerable impact on your estate planning over time.
Examples of where this Small Gift Exemption could be used to transfer significant amounts of money to family members:
- Two parents could give a combined gift of €6,000 each year to a child building up an investment of €30,000 over 5 years, or
- A child takes €3,000 from each of four grandparents and from each parent (€18,000 altogether) in a year without any tax.
These gifts are excluded from the recipient’s lifetime tax-free thresholds meaning that the tax liability of the remaining estate on inheritance is unaffected by these gifts.
This shows the value of proactive tax planning to ensure all available reliefs are incorporated into any inheritance plan.