What is a gift tax?
In some countries, the tax is collected on those who give a large gift of money or property to another person without receiving anything of the same or greater value in return. Both parties involved in the stock exchange (donor and recipient) must live at the time the tax is given to apply in most cases. The donor usually pays tax, although there are circumstances where the recipient can provide instead of paying. If the donation tax rules are applied, the person may be allowed to provide cash or other items awarded with a certain amount (eg $ 13,000 in the US (USD) in the US since 2011) to be responsible for the tax. There are also some gifts that are not considered to be taxable in some countries.
taxable items
which gifts are taxable is different depending on jurisdiction, but usually applies only to gifts that are of significant value. This could include items such as a new car, antique furniture, house or even cash. Items such as shares or rentals that can bring forThe recipients are also included.
If the recipient pays the donor less than the real market value of the item, it can also be considered a gift and is subject to donations. However, what the donor considers fair and what the government's income agency defines as the value of the item may vary. Before the donor gives something valuable, the donor should have the item assessed and record careful records of what is worth it.
taxable amounts
In the United States, since 2011, the annual amount of exclusion has been - the annual total value of gifts that the donor can provide to any single recipient - $ 13,000. Taxpayers can give gifts below this amount annually without paying donations tax. Therefore, for example, the donor could give every five people $ 9,000 without being taxed, although the total - $ 45,000 - is above the annualome. This amount applies to change, so people who plan to provide a largeGifts should check the relevant Tax Act, which should be current in the applicable regulations.
who pays the tax
It is a common misconception that the recipient of gifts is responsible for paying tax; In most cases, however, it is a donor who pays. If the recipient later sells or distributes the item, taxes may be owed, especially if the property has been in possession for several years. In addition, if the item creates income - as it can be in the case of shares or rental property - then the recipient will have to pay taxes on this income.
A special income tax form may be required to declare any given gifts; In some cases, the donor must file this yield even if no real taxes are owed. Many tax professionals recommend that you file a tax return on tax taxes in those countries they require if the gift is closed to the amount that would be taxable. In this way, if there is a something of the value of the value, the donor afterHe gave at least the correct paperwork.
Exceptions
quite often, the government allows the husband and wife to give the same person a gift without paying any of the parties; However, this usually applies to cases where the gift amount provided by each spouse was below the dollar. In most cases, the husband or wife in most cases can give their husband gifts for any amount without paying any tax at all. This is not true between children and parents.
In many countries, including the US, the payout of tuition or medical expenditure, which is paid on behalf of someone else, is not subject to gifts. Gifts to political organizations are also excluded in many cases. In a gift gift, the donor can not only be exempt from paying gift tax, but can also be able to take a tax deduction. (This is usually the only type of gift that is tax restable.)
ways to avoid the tax
Some jurisdictions have exemptions from lifelong gifts , which means that no taxes are owed by any gifts until the sum of this exemption is met. In other words However, this does not necessarily mean that the donation tax is not necessary; In the US, a return is required whenever gifts per individual above annual limit, although it is significantly under a lifelong exception.
It may also be possible to avoid taxes from gifts instead by creating confidence in which assets are held in favor of a third party. This can reduce the amount of taxes owed by the person by the establishment of trust known as trustworthy. However, the amount owed by the transfer of large amounts of money or assets varies, so donors or confidants should first consult with an informed tax prison, a financial planner or accountant, if the gift is considerable.