Who hasn't received or given a small amount of money or a piece of jewelry on the occasion of a birthday, an exam, a wedding... But this gesture of generosity must respect a minimum of formalism in order not to arouse the suspicions of the tax authorities or trigger the wrath of the heirs.
Words have their importance
First of all, it is perhaps useful to clarify the vocabulary. What is the difference between a manual gift and a customary gift? It is common to confuse them. Basically, they are both about giving "from hand to hand". But legally, it is not the same thing. A customary gift is a gift whose value is related to the lifestyle and financial capabilities of the person who gives it. It is not "reportable" to the inheritance of the donor, i.e. it will not be taken into account whenopening the inheritanceand distributing the patrimony among the heirs. Another difference with the manual gift is that the gift of use is not subject to gift tax because of the small amount or value of the property given by this means.
In all legitimacy
The simplicity of the manual gift can be a source of trouble if the donor does not respect a few rules. First of all, its validity depends on the agreement of both parties. The donor must do so without any coercion and the recipient must accept the gift with full knowledge of the facts, without being forced to do so. The manual gift must have a lawful cause (willingness to compensate someone who has done you a favor, proof of a feeling of affection...). Finally, it must be made within the limits of the "available share" (part of the patrimony that the donor can dispose of as he pleases), and must not infringe on the inheritance rights of the other heirs.
Remember to declare it
Any manual gift must be declared to the tax authorities. On the one hand, this will avoid possible conflicts with other heirs. Indeed, a manual donation is not as trivial as it seems. Without meaning to, you can create an imbalance between the members of your family and generate tensions when the estate is opened. It is therefore better to be clear from the start. On the other hand, the tax authorities are vigilant and there is a risk of tax reassessment. A large difference between the income declared by a taxpayer and the resources invested or spent could alert the tax authorities to the existence of an undeclared manual donation. If the tax authorities can prove that the gift has been deliberately concealed, the taxes normally due may be subject to late payment interest and heavy penalties. And just because you declare a gift does not mean you will have to pay tax. It will not be taxed if its value is less than the allowances provided by law. For example, at present, theallowance between parent and child is €100,000 every 15 years. It is therefore possible to give to each of his children a property up to this value without paying taxes.
In one click it's easier
The person who receives a manual gift has the choice between two methods of declaration. Either the paper form via the form n° 2735-SD which will be sent to the tax authorities, or the digital form. Since June 30, 2021, a new service set up by the tax authorities allows you to declare online donations of money, shares, company securities, movable property or works of art received from a relative or a third party. Simply log on to your Espace Particulier at www.impots.gouv.fr by entering your 13-digit tax number and password. You can also log on with your Ameli, post office, MSA or Mobile Connect et moi account by clicking on the FranceConnect button.
Whatever your choice, between a gift of use or a manual donation, it is strongly advised to consult your notary to evaluate the consequences of your act
Marie Christine Menoire