CAT on 10k gift to friend?

I wish to gift 10k to my sister in law (though they are not yet married so effectively a friend for tax purposes) to set up a small business for herself.
I've google and found CAT threshold of €15, 075 for a gift to friend. Can anyone please confirm this is correct?

If I give a loan instead to make it easier (conscious wise) for her to accept, can I simply hand over a bank draft and call it a five year loan at 4 %. Any tax implications here for either of us?.
My s-i-law is very competent, trustworthy and gave up work to raise the kids. This woild get her back to work. Thanks for any advice.

paddytheape said:

I wish to gift 10k to my sister in law (though they are not yet married so effectively a friend for tax purposes) to set up a small business for herself.
I've google and found CAT threshold of €15, 075 for a gift to friend. Can anyone please confirm this is correct?

Click to expand...

Yes, see here: http://www.revenue.ie/en/tax/cat/thresholds.html

You can also avail of the small gift exemption of €3,000 per annum thereby not using up as much of her CAT threshold. The gift can be spread out over a couple of years if possible to reduce further.

If it is for a college course or something there may be relief due to you for paying fees directly.

Call it a loan by all means but if you get into charging interest then you are liable to income tax on the interest which makes it a bit messier from your point of view.

The sister-in-law would be liable to CAT on the "interest" you don't charge, but the amount in your example is only €400 per annum so well covered by the small gifts exemption.

If you're married, you could look at gifting the whole €10k to them...money comes from a joint account to their joint account...4 x €2,500 which is less than the Small Gift Exemption.