Revenue Canada Gift Tax

Canada has no gift tax so you can give your children any amount of cash and it is not taxable as income or deductible as an expense.

Revenue canada gift tax. Making the gift or transfer of property to your spouse as opposed to a child or other family member usually will automatically occur on a tax free basis unless you elect otherwise. You may receive gifts and inheritances up to a set value over your lifetime before having to pay cat. For more information go to returning a gift to a donor and see guidance cg 016 qualified donees consequences of returning donated property. Information for individuals about making a gift in the year and about gifts made in the previous year.

Gifts become inheritances if the person dies within two years of giving the gift. For additional information on the tax rules regarding gifts and inheritances call or visit canada revenue agency. Gift from someone in debt to canada revenue agency income tax act s. For more information on previous rates see cat thresholds rates and rules.

Tax consequences credits qualified donees. If the fair market value of the noncash gift has increased from when it was acquired the gifting may trigger an immediate capital gain. If the court orders that the gift be returned to the donor the qualified donee must send a letter with this information to the canada revenue agency. In spite of this giving away cash in your lifetime may save taxes against your estate after you die.

Once due it is charged at the current rate of 33 valid from 6 december 2012. Securities like stocks and bonds also qualify as gifts. What makes a gift. Employers can use the total cost of the gift as a tax deduction and employees don t have to declare the cost of the gift as part of their taxable income.

However you and your spouse must both be canadian residents at the time of the transfer. For legal advice and assistance with tax planning a cra tax dispute or other tax issues contact tax chambers llp. Follow the canada revenue agency cra gift tax rules and give your employees gifts instead of cash bonuses and both you and your employee will benefit on your canadian income tax. 160 if a tax debtor transfers cash or other property directly or indirectly by means of a trust or by other means whatever to.