With effect from 1 January 2017, the (maximum) gift exemption for gifts for the donee's own home is (again) €100,000. However, in a number of situations, this high exemption can only be used optimally if it is already anticipated in 2016.
Conditions
To benefit from the new gift exemption of €100,000, the following conditions must be met:
- the donee is older than 18 but not older than 40 at the time of the gift (the exemption is not limited to acquisitions by children);
- the donated amount must be used to meet expenses relating to the donee's own home;
- the exemption may only be used once (when acquired from the same donor), but the donation can be used over 3 consecutive calendar years.
Gift exemption in 2016
For gifts made in 2016, an exemption of € 2.122.
If parents donate to children, a higher exemption of € 5.304. In the period when the child is over 18 but under 40, this gift exemption is increased once to:
- € 25.449 (freely disposable)
- € 53.016, provided the gift amount is used for the donee's own home or studies.
Children to whom gifts were made before 1 January 2010 under the increased gift exemption (in 2016: €25,449) may additionally be exempt from gift tax € 27.570 received from their parents, provided the gift is used for the donee's own home.
All enhanced exemptions must be explicitly invoked in the gift tax return. This tax return must be filed with the Inland Revenue within 2 months of the end of the year in which the donation took place.
Transitional law
The need to anticipate the new gift exemption lies in the transitional law. In particular, it concerns the following two situations.
Children who claimed the catch-up exemption of €27,570 in 2015 or 2016 can additionally claim the new gift exemption. This can be done for the remaining amount of €100,000 -/- €53,016 = € 46.984.
But this can only be done in the years 2017 and 2018.
If in 2015 or 2016 only the freely spendable increased gift exemption was invoked (in 2016: €25,449), in 2017 and 2018 there is additional entitlement to the gift exemption only up to the aforementioned amount of €46,984. The total gift exemption will then not reach €100,000, but only € 72.433 (€ 25.449 + € 46.984).
The anticipation consists in postponing the gift under the freely disposable enhanced gift exemption until after 2016 or claiming the catch-up exemption in 2016 anyway.
Suspensive condition
Another catch is that in many cases, the gift, to which the increased gift exemption must be applied, must be subject to a condition precedent. Only when this condition is fulfilled will the donation come into effect.
This should be anticipated when the gift must necessarily fall in a particular year (see above) or when the donee's age threatens to pass 40.