Sole Trader - Gifts to Family Members

sally365

Hi,

Quick question:

Can a sole trader give a gift of money to a family member or another person and get a reduction in tax from that gift?

Sorry if I haven't explained that correctly?

Regards,

Alan Shore

A gift as outlined would not qualify as a deduction for tax it is a distribution classed as drawings.

Beal Tuille

Nope.

Alan Shore has outlined it correctly.

It may not be taxed in the hands of the recipient but it would not be a valid business expense for the sole trader.

2ndcoming

In fairness if this was the case why would any sole trader pay any tax?

"I give it all to herself sure!"

sally365

I thought you could give 3k max, although maybe that's if you are a Ltd.

phormium

You can give someone a gift of 3k and they are not liable for gift tax, no advantage to you though, it will come out of your after tax income.

srsly78

sally365 wrote: »

I thought you could give 3k max, although maybe that's if you are a Ltd.

A limited company can give each of it's employees e250 of non-cash benefit without incurring tax (usually means voucher) per year.

http://www.revenue.ie/en/business/paye/guide/employers-guide-paye-definition.html (see small benefit section).

Mr. Incognito

If you are a sole trader you are unincorporated so there is no issue re company law.

You can provide a gift of up to €3,000 per year free from CAT to the person whom you are giving it to.

You can never use gifts from a sole trader as a tax shelter. You can give valid employment payments and take a deduction for them under employment law guidelines.

Thread closed as this is bordering on tax avoidance schemes and I am uncomfortable with this line of enquiry.