Family Trusts and Gifting Assets

Gift Duty

If an individual gifts more than $12,000 in any 365 day period then they legally have to notify the IRD of the gift using IRD form IR196. An individual can gift up to $27,000 per year and not incur any gift duty liability.

value of GiftDuty Payable
0 to $27,000NIL
$27,001 to $36,0005% of value over $27,000
$36,001 to $54,000$450 plus 10% of value over $36,000
$54,001 to $72,000$2,250 plus 20% of value over $54,000
Over $72,000$5,850 plus 25% of value over $72,000

The original gift is acknowledged by "Deed of Acknowledgement of Debt".  Each year this original debt is reduced by gifting.  The IR196 form is completed together with a "Deed of Partial Forgiveness of Debt" and sent to the IRD.

We also recommend that you keep an 'Asset Schedule' so that you can easily identify a history of gifting and any new funds added to your trust.

Refer also to:
Family Trusts
Trustee Responsibilities
Property Relationships Act