Finance Act 2014 has curtailed the provision in legislation which allowed parents to make payments for the support, maintenance or education of children (of any age) with a full exemption from gift tax provided the gift was considered normal expenditure of the parent and was reasonable having regard to the parents’ financial circumstances.  

Following the recent legislative change the exemption only applies to payments made for the maintenance, education and support of:

  • Minor children (under 18)
  • Children aged between 18 and 25 where they are in full-time education

Full-time education includes third level education and training for a trade or profession to which the child must devote not less than two years. In the case of a child training for a trade or profession, Revenue has the power to request reasonable proof of this from the child’s employer.