Gifting cash and tax

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Forums › Finance and wealth management › Gifting cash and tax

epr

260 posts

Ultimate Geek

#248084 9-Mar-2019 19:42

Hey there,

I just want some basic information on how much cash I can gift per year before it attracts tax, i am not asking for professional advice if I need I can approach an accountant I just want a general guide so I can get an idea ird has so much complexity and changes in rules depending on the date of the gift etc.

thanks in advance

Linux

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#2194738 9-Mar-2019 19:54

@epr Just been thru this with my mum and dad and no tax if it's a gift of money to someone close / someone you love

My parents gifted me quite a bit and I now have a very small mortgage

The tax was abolished in 2011 or 2012

Linux

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#2194751 9-Mar-2019 20:28

Sorry should of mentioned no limit on gifted amount

Aredwood

3885 posts

Uber Geek

#2194763 9-Mar-2019 20:52

As above, no actual limit as such. But it can cause future problems for things like subsidies for rest home care.

And if the money is from a company, then tax might need to be paid on it.

Without knowing anything else, I would recommend seeing an accountant, and depending on what the accountant says, a lawyer as well.

antoniosk

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#2194765 9-Mar-2019 20:53

epr: Hey there,

I just want some basic information on how much cash I can gift per year before it attracts tax, i am not asking for professional advice if I need I can approach an accountant I just want a general guide so I can get an idea ird has so much complexity and changes in rules depending on the date of the gift etc.

thanks in advance

Gift duty was abolished because it was costing more to administer than it actually collected.

Here's the details from IR:

https://www.ird.govt.nz/duties-levies/gift/gift-duty.html

Note that for Rest-Home support, MSD will look at your parents records going back 10 years, and will make a determination on whether the gift was made to avoid the personal wealth test or if it was a genuine gift.

________

Antoniosk

nickb800

2723 posts

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#2194766 9-Mar-2019 20:53

As above - no gifting tax anymore (technically the rate is set to zero I think).

Bear in mind that there are thresholds for gifting that affect your eligibility for a rest home subsidy

solutionz

589 posts

Ultimate Geek
Inactive user

#2194831 9-Mar-2019 22:51

There are considerations around what the assets and entities are that you're dealing with.

Cash from you to family, friends etc - no tax as above.

A house etc from you to a trust - usually done though a paper loan and then gifting forgiveness of the debt.

Cash or property as a donation to a community group - you may be entitled to a tax refund.

Cash from a company or in exchange for some benefit - probably taxable as income.

https://www.ird.govt.nz/technical-tax/legislation/2011/2011-63/2011-63-gift-duty/leg-2011-63-gift-duty.html

epr

260 posts

Ultimate Geek

#2194868 10-Mar-2019 07:25

Thank you all that is excellent information that You have imparted.