About Us
Our Services
Learning Center
Contact Us

Gift Tax Free


How Much of a Cash Gift is Tax-Free in Canada?


Here’s the good news – if you want to give your children a lump sum of money as a gift, it’s completely tax-free. In other words, you don’t have to pay taxes on gifted money, no matter who you receive it from. This is true regardless of whether the giver and the receiver are related or not.

There are two main types of gifts that people can give: “inter-vivos” and “testamentary”. Inter-Vivo gifts are those that are given during your lifetime. Testamentary gifts are those that are given after your death and are often found in your Will. Both inter-vivo and testamentary gifts are tax-free in Canada if they are given in the form of cash or money.

And here’s more good news – you can gift as much money as you want without being taxed. In Canada, there’s no limit on how much you can gift someone. Whether you gift them $500 or $30,000, it’s all completely tax-free.

According to the Financial Post, a recent poll found that many Canadians were confused about the taxes associated with making a gift, with over half admitting they simply didn’t know what taxes exist on a financial gift to a child or relative, while nearly 10 percent believed that the gifts were potentially taxable to the recipient.

While gifts themselves are, indeed, received tax-free, it is important to keep in mind that there can be taxes arising depending on what is given away. When you make a gift of assets “in-kind,” such as appreciated securities or real estate, you will generally be treated as if you have sold the gifted property at fair market value, and you will pay tax on 50 percent of capital gains.  So, it does appear cash is king when gifting.


What is an Estate and How is it Taxed?

Want more information?

Are you interested in a consultation with Peter R. Welsh?
Contact me at Peter@SmartWills.ca
By telephone 416-526-3121
Register for our blog to get valuable tips and up-to-date alerts.

This material is for general information and educational purposes only. Information is based on data gathered from what we believe are reliable sources. It is not guaranteed as to accuracy, does not purport to be complete and is not intended to be used as a primary basis for investment decisions.

Leave a Reply

Your email address will not be published.