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Parents paying for weddings

  • 20-09-2021 2:58pm
    #1
    Registered Users Posts: 19,510 ✭✭✭✭ yourdeadwright


    Just wondering if any of you guys had there parent's pay or contribute to your wedding,

    My mother wants to give my sister a cash gift for basically spending a decade looking after her ,

    She is worried that she may have to pay tax on it so she is suggesting to hold off and help pay for her wedding in 2023.

    What would be the best way to go about it, pay for the venue or give my sister the cash to pay for the different parts of the day ,



Comments

  • Registered Users Posts: 26,452 ✭✭✭✭ Creamy Goodness


    A parent can gift up to €3,000 tax free in any give tax year (it's per parent so max possible of €6,000), above that will require the payment of CAT. Not many people here are going to give you advice on tax evasion considering it's a criminal activity.



  • Moderators, Category Moderators, Home & Garden Moderators, Recreation & Hobbies Moderators, Social & Fun Moderators Posts: 21,294 CMod ✭✭✭✭ Pawwed Rig


    They can gift the spouse aswell so €12k is possible. Also reading today that there is talk about the small gift exemption rising to €5k.

    OP how much does she want to gift? If she is gifting in excess of small gift exemption then I would need to know a lot more before giving any advice



  • Registered Users Posts: 19,510 ✭✭✭✭ yourdeadwright


    I'm not asking for advice on tax evasion just wondering what way people went about it,

    I'v heard numerous occasion of peoples paying for wedding or giving cash gifts iv always wondered how they do it , Does it count as a gift if she paid for the venue ?



  • Registered Users Posts: 19,510 ✭✭✭✭ yourdeadwright


    Sorry i should have said she wants to give her 10 grand ,

    Father not around so could not be from two parents ,



  • Registered Users Posts: 26,452 ✭✭✭✭ Creamy Goodness


    Gotcha, going by what @Pawwed Rig said, she should be able to gift the spouse as well which I had forgotten you could do.



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  • Registered Users Posts: 140 ✭✭ mmc2010


    I would have thought her mother is 'hosting' the wedding, if she's paying for it. She can pay the hotel directly for her party that she's throwing for her daughter, if she wishes to do so. I'm not a tax expert though :-)



  • Registered Users Posts: 48 OscarBluth


    Both our parents gave us a cash gift for our wedding, they just transferred money into our account. As far as I'm aware, there's no need to inform revenue that its for the purposes of the wedding or anything like that, or for them to directly pay the venue to prove it was for the wedding.

    My memory (we looked into it because we were buying a house at the same time and they kindly gave us some money for that too) is that if you are given a certain high % of your tax-free threshold you're meant to inform revenue, but from a parent that threshold is literally hundreds of thousands. So, if she was giving her 200k, that might be an issue, but if she wants to give her 10k towards her wedding, there's absolutely no issue with it just being a cash transfer. Or, if she wants, her paying for the wedding dress, or paying for the venue directly.

    Equally as other people have said, if she wants to give 10k total she could give 3k in 2021, 3k in 2022, and the remaining 4k towards the wedding in 2023, if it would be more convenient for all of them to have the money now to spend on other things as 3k would be in the annual gift allowance amount. And if her and her fiancee have joint finances, she could given them each 3k a year, doesn't need to be declared.



  • Registered Users Posts: 19,510 ✭✭✭✭ yourdeadwright


    So she would have to wait until they are married ?

    I'm not asking to dodge tax I'm asking so its done correctly if you get me,

    Is the CAT threshold not something just over 300 grand in Ireland? & if the gift threshold was breached as in it was over 3000 in one year is it not just be taken off your CAT limit ?

    Sorry i'm no expert as you can tell



  • Registered Users Posts: 65 ✭✭ musicfan1ie


    Hi OP

    Weddings paid by parents on behalf of children are considered exempt from gift tax - see link below from Revenue. Probbaly best to allocate specific costs of the wedding to your mother, so that it's in her name. I've also added the paragraph highlighting the exemption

    Guide to the CAT Treatment of Receipts by Children from their Parents for their Support, Maintenance or Education (revenue.ie)

    Cost of Family Functions Paid for by Parent The costs of a family function such as a wedding paid for by a parent. Revenue takes the view that this is the expense of the parent rather than a gift to the child. Therefore, there are no gift tax implications. This extends not just to the cost of catering for guests but also to all of the costs associated with the occasion. However, a gift such as a car, a house or a paid holiday is still a gift for gift tax purposes, notwithstanding the fact that it may be associated with a family occasion such as a wedding. To the extent that any such gifts do not exceed the €3,000 small gift exemption in any year, they are not subject to CAT



  • Registered Users Posts: 3,462 ✭✭✭ Bob Harris


    The CAT threshold is 335K and is cumulative. If you get 10k in one year the first 3K is exempt, and your threshold now falls to 328K.

    If you get another 10k next year, 3k is exempt and your threshold is now 321K.

    You won't pay tax until the threshold is breached. As for what constitutes a gift, that's debatable.



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  • Registered Users Posts: 19,510 ✭✭✭✭ yourdeadwright


    Thanks for the input that's actually what i thought ,

    Sorry for the next question as it may seem obvious,

    I'm guessing she will have to declare the gift to revenue ?



  • Moderators, Category Moderators, Home & Garden Moderators, Recreation & Hobbies Moderators, Social & Fun Moderators Posts: 21,294 CMod ✭✭✭✭ Pawwed Rig


    You only declare when you have exceeded 80% of the threshold which is somewhere around the €260k mark (roughly)



  • Registered Users Posts: 19,510 ✭✭✭✭ yourdeadwright


    So basically my mam could just send the 10 grand into my sister account and that's it all taken care off until the day comes when inheritance from properties & things is being shared out ?

    Thanks for the input



  • Moderators, Category Moderators, Home & Garden Moderators, Recreation & Hobbies Moderators, Social & Fun Moderators Posts: 21,294 CMod ✭✭✭✭ Pawwed Rig


    Yeah pretty much. It depends on how much you will be ultimately inheriting. If you are ever likely to breach the group A threshold then I would advise protecting the threshold now by utilising small gift exemptions. If you are never likely to breach the threshold then you've nothing to worry about.

    I would caution that the Group A threshold can change over time. Not that long ago it was 250k



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