gift from parents/brother ?

J

jtm

Guest
Hi, I understand from previous threads that a parent can gift a child
up to 450K (aprox indexed) over a lifetime.

My parents are planning to help me with money towards a house purchase
i am a FTB, however whats the situation if my brother wants to help me out also?
would it be best for him to transfer funds to them (40k) and they give it to me ? how are these transfers of funds treated by banks/revenue
 
For 2007 parents to child (Group 1 ) is €496,824 . Brother to brother (Group 2) is €49,682. Child to parent (Group 2) is €49,682.
If your brother gifts to you then once you have taken €49,682 any other Group 2 gifts/inheritances are taxable.
Your brother gifting to you via parent looks like a gift from him to them and them to you. While this may seem like a way to get almost €50K tax free to you could be viewed as "gift splitting" and Revenue may view it for what it is.
There is also the annual €3,000 small gift exemption which can be taken tax free from any individual so your brother and parents could each give you €3,000 without it affecting your threshold from them.
 
thanks graham-07

would they (rev) pick up on that?
the amount my parents would gift would be added to that so total would be in around 90-100k
 
Yes, the Revenue will pick up on the "gift" from your brother to them and on to you, as there is a section on the gift tax return form that specifically asks about this (and lying on the form is an offence).
 
Once 80% of the relevant threshold has been exceeded a Revenue return is required (Form IT38) and Revenue pick up data from there even though no tax might, at that point, be chargeable.
Revenue also issue a good guide [broken link removed]
Where C.A.T. is involved ( Gift or inheritance tax) a professional consult is always worthwhile and may avoid future pain.
 
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