Options Available To Save For Children

Over the last few years, there has been a lot of interest in gifting cash to children and availing of the annual Small Gifts Exemption. In particular, grandparents want to pass some of their accumulated wealth to

grandchildren and would like to do so in a tax efficient manner. It is interesting to note that this grouping accounted for €236,650,000 of the €522,000,000 Capital Acquisitions Tax take for 2018*.

Gift tax comes under the Capital Acquisitions Tax ‘umbrella’ and is payable on certain gifts made during the lifetime of the donor. The person making the gift is called the donor or disponer and the person receiving the gift is called the donee. A gift is taken when a donee becomes beneficially entitled in possession to some property or asset.

The tax, if any, is payable by the person receiving the gift. However, the thresholds for Capital Acquisitions Tax apply so if the value of the gift comes under the threshold amount, no tax is payable until such time as the value of all accumulated gifts exceed the relevant threshold.

These thresholds can be reached either by a single gift or by a series of gifts and inheritances over a period of years. Only prior gifts and inheritances to which the same group threshold applies are aggregated (added together) for the purposes of calculating tax.

However, there are several exemptions available for Gift Tax, one of which is the Small Gifts Exemption (SGE), amounting to the first €3,000 of all gifts taken by a donee from one disponer in any calendar year.

** Source: Revenue.ie *Irish Statute book

Reach out today

Contact us today and book your consultation https://www.quigley.ie/book-consultation and see how Quigley Financial Brokers can help you choose the best options available or contact richard@quigley.ie for further information.