How much can you donate free of tax?
As a donor, you can give a person a tax-exempt gift, worth less than €5,000, every 3 years.
The above threshold concerns the donor. This means that one donor can make more than one tax-exempt gifts as long as the threshold is not exceeded, or as long as the recipient is another person.
Example: On 1 January 2021, the mother and father of a family with 2 children make them 2 gifts of €4,999. This way, both children receive €9,998. Both parents have given €4,999 twice. The next time when both parents are able to make 2 tax-exempt gifts of €4,999 to both their children will be 1 January 2024.
Because no gift tax is imposed in this case, the gift recipient does not have to file a return unless so requested by the Tax Administration. However, sometimes it is advisable that you should also submit a gift tax return when you receive a gift of smaller value. If you were to sell the asset later, you could then use the confirmed gift tax value of the asset as the acquisition cost.
Moreover, if you make a gift of household effects or donate money for purposes of education, upbringing and maintenance of the gift recipient, your gift may be exempted from tax. Read more about gifts of household effects and gifts for upbringing and education.