Gifts and estates

Gifts on paper, a form of inheritance tax planning, are common practice in the Netherlands. Let’s start off by clarifying that gifts on paper involve no transfer of money. Instead, the giver owes a debt to the recipient and must pay the recipient 6% interest on that amount each year. This arrangement has advantages for both the giver and the recipient. However, it’s important to be aware of the formalities and consequences for income tax.