Donations can involve any asset, but depending on whether it is a particularly significant
gift or a gift of modest value that can be hand-delivered (provided the donee’s consent is
undeniable), some formal requirements change.

How is it determined when a donation is of modest value or not?

Two elements must be considered:

1. 1. The actual and objective value of the asset being donated.
   2. The financial situation of the donor.
   Essentially, according to the Civil Code, a donation is considered of modest value when the
   donated amount does not appreciably affect the donor’s assets. Conversely, to comply with the
   law, it might be necessary to consult a notary if the donor has a less affluent situation but wishes
   to donate something that objectively has little value.

Using the same criteria, money can also be donated, but in this case, the regulations on cash
circulation must be considered: if an amount up to €2,000 is donated, the gift can be
hand-delivered, while for higher amounts, it will be necessary to use a traceable instrument
such as a bank transfer or a check, under penalty of a fine between €3,000 and €50,000.

The Case of a High-Value Cash Donation

When it comes to a high amount, the law makes the intervention of a notary indispensable, and
the donation must be made via public deed in the presence of two witnesses.

If this constraint is ignored, anyone could challenge it at any time, and the beneficiary would be
obliged to return the money received

Cash Donation: Direct or Indirect?

Then there is the issue of direct or indirect donations, where the type changes depending on its
purpose. For example: a bank transfer of €5,000 to a child without specifying its use constitutes
a direct donation. If, however, with the same €5,000, the parent pays for furniture for the child’s
home, they are making an indirect donation.

Even in this case, there are legal differences: in the case of a direct donation, what was stated
above applies: if it is of modest value, no notarial formalities are required; if it is not, a public
deed will be needed. In the case of an indirect donation, however, no other formalities are
required.

Is a Cash Donation Taxed?

In the case of non-modest value donations, taxation depends on the amount and the recipient of
the donation.

It should be noted that for money donated to a child, there is a tax-free threshold of 1 million
euros, and the lowest rate applies, i.e., 4% for donations between parents, children, and
grandchildren, on a value exceeding 1 million euros; while between siblings, the tax-free
threshold is 100,000 euros with a rate of 6%; for collateral relatives up to the fourth degree,
the rate is 6% but without a tax-free threshold; and finally, for all other relatives and unrelated
individuals, the rate is 8% without a tax-free threshold.

Who Pays the Taxes? Are There Exceptional Cases Where They Are not Paid?

Taxes will be paid by the donee, and besides donations of modest value, nothing is owed in the
case of donations intended to cover expenses for maintenance, education, clothing, or
marriage.