Gift Tax

Gift tax applies when you transfer assets during your lifetime without receiving payment in return. Money to your children, a property to your partner, shares to the next generation.

There are 3 models. In the United States and South Africa the donor pays gift tax. In Ireland and many civil law countries the recipient pays. Canada and Australia have no gift tax, but a gift can count as a sale at market value, so the donor may owe capital gains tax. New Zealand abolished gift duty in 2011.

Allowances work differently everywhere. The United States allows USD 19,000 per recipient per year in 2026, and larger gifts count against a lifetime exemption of USD 15 million shared with estate tax. The United Kingdom has no separate gift tax: gifts to individuals become tax-free if the donor survives 7 years. South Africa grants an annual exemption per donor.

Gift tax and inheritance tax usually work as one system. Planned early, lifetime gifts can use annual allowances repeatedly and shrink the taxable estate.

A gift from a US citizen living in Panama to a child is still within the reach of US gift tax, because the United States taxes by citizenship. The same gift between 2 Panama residents without US ties is not taxed at all.

Under a Sovereign Blueprint, succession is planned with the residency of every family member in view, not just the donor. Which transfers are tax-free in your setup is a question we answer before the transfer.