time limits on 3K gifts

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john luc

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If person A gives a €3K gift to person B and also give the same to person C,can person B give a €3K gift to person C in the same calender year.
 
You can give away as much as you like, but for the recipient (and I'm open to correction on this) I believe your tax free gift limit is €3K per year, the source of the gift is not relevant.
 
john luc said:
If person A gives a €3K gift to person B and also give the same to person C,can person B give a €3K gift to person C in the same calender year.
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There was a Q&A about this in one of the papers a few months ago. The answer (if I recall correctly) was that from a Revenue point of view this is likely to be regarded as Person A giving €6k to Person C. The gift to B must be bone fide, and this wouldn't look like it is. Though how it is policed I have no idea.
 
I have just being trawling the revenue website and cannot find any caveat to say it's not allowed. Seems like an obvious loophole not to be plugged though.
 
If the gift from A to B is made on the expectation that they make the gift to C, then it's not a bona fide gift, so not exempt.
 
Section 8 CATCA 2003 refers; essentially it’s anti-avoidance to stop someone using an intermediary for gifts to obtain higher tax-free thresholds.
 
I wonder has there ever being a challenge to this. Be an interesting case to prove in a court of law.
 
At the €3k level, I don’t belive that it’d ever get that far.

The provision is designed to catch (say) a grandfather giving €310,000 to his son for the son to then give €310,000 to his son (i.e. the grandson).
 
I know of a couple that gifts 6k each to their son and daughter and then another 3k each to the couple's sister and brother (aunt and uncle to the children) who in turn gifts that money back to the son and daughter. So Instead of only gifting 6k each year tax free, the couple can gift 9k each. Hard to proof anything illegal I would think.
 
Thirsty said:
You can give away as much as you like, but for the recipient (and I'm open to correction on this) I believe your tax free gift limit is €3K per year, the source of the gift is not relevant.
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For the record, this is incorrect. A recipient can receive any number of 3K gifts in a tax year provided they are from different people. A (relatively) common set of gifts is from parents to e.g. daughter and son-in-law - 12K can be transferred tax-free every year from the older couple to the younger couple.
 
Broadcaster said:
I know of a couple that gifts 6k each to their son and daughter and then another 3k each to the couple's sister and brother (aunt and uncle to the children) who in turn gifts that money back to the son and daughter. So Instead of only gifting 6k each year tax free, the couple can gift 9k each. Hard to proof anything illegal I would think.
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If Revenue looked at this they could raise an assessment to tax for €3k. They would not have to prove anything. The tax payer could go to an appeal but not a sensible option under the circumstances.
 
that's my contention In asking this. Does anyone know of any case where revenue went after someone who did this. Be interesting to see how it went.
 
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