Are you planning to slip some hard cash gifts under the tree for your children, grandchildren, nephews, nieces or close friends? To offer large sums of money or valuable objects – branded bags, watches, jewelry, furniture, etc. -, while preventing Bercy from seeing them as disguised donations and taxing them as such, the mechanism of the gift of use is ideal. As long as it respects three strict rules, your gesture will not be considered a transmission. The beneficiaries will therefore not need to report it on the day of your inheritance, nor will they need to declare it for taxes.
The tax authorities do not give any scale
To be valid, a customary gift must coincide with a special occasion. This could be, for example, a religious holiday, New Year, a birthday or passing an exam. Second imperative, “it must be carried out only on an exceptional basis, without recurrence”, specifies Grégoire Mitry, notary in Nantes. Impossible, therefore, to consider as such the payment, every month, of a financial boost to a student grandchild to help him make ends meet.
Third criterion: “The sums of money given, or the value of the goods offered, must not be excessive in comparison to the income and assets of the person making the customary gift”, underlines Arlette Darmon, notary and president of the Group Monassier. The difficulty? The tax administration does not indicate any precise limit. The assessment is therefore subjective and depends, in particular, on your lifestyle and the number of beneficiaries. To avoid risking your present being reclassified as a donation, remain reasonable and keep in mind that it should not impoverish you.
Equal treatment is not required
In the light of these three principles, your present usage will not be questionable. Unlike a shared donation, you are not required to respect equality between the people who are the objects of your generosity. You therefore have the possibility of offering different amounts or goods of different values, by giving, for example, more to the children who regularly come to see you or to those who need it the most. Finally, the mechanism of the customary gift allows you to reward anyone, regardless of their relationship to you. It can be done outside the family, to spoil a close friend, your significant other’s child or a person who takes care of you.