You may be wondering…

• Can I gift any amount of money, or is there a legal limit?

• Do I have to report the gift to the tax office?

• Do I pay income tax if I receive a million from my parents?

• What if the gift comes from a “non-relative”?

Clients ask me…

Is there a legal limit on how much money can be gifted?
No – the law does not limit the amount you can gift. The issue is mainly tax and compliance.

Do I have to report the gift to the tax office?
If the gift is from close relatives (parents, children, siblings, spouses, household members), it is exempt and does not need to be declared. If it’s from a “non-relative” and exceeds CZK 15,000, it must be reported in the income tax return and taxed.

Can the tax office ask about the source of the money?
Yes – especially for large sums. They may require proof of the source to rule out money laundering or tax evasion.

Gifting large sums in a nutshell

• No legal limit on the amount you can gift.

• Exemptions apply to family and close persons.

• CZK 15,000 threshold per year for gifts from non-relatives (above that, taxable).

• Possible checks on the source of funds by the tax office or banks.

Main risks and mistakes

1. Cash handover. Large cash gifts look suspicious and may cause issues with the bank or tax office.

2. Ignoring gifts from non-relatives. If not reported, back taxes and penalties apply.

3. No written contract. For large sums, a written gift agreement is essential.

4. Unproven source of funds. The donor should be able to show where the money came from.

Step-by-step process

1. Draft a gift agreement. Even for money – it protects both parties.

2. Transfer via bank account. Bank transfers are verifiable.

3. Check if the gift is taxable. Family gifts are exempt; gifts from non-relatives over CZK 15,000 must be taxed.

4. Keep proof of the source of funds. If asked, you can demonstrate the legality.

Real-life example

A client gifted his daughter CZK 2 million to buy a flat. The transfer was documented by a written agreement and bank transaction. Because it was a gift between father and daughter, it was fully exempt from tax. Another client received CZK 200,000 from a friend – that gift had to be reported and taxed.

Why to be cautious

Large amounts attract scrutiny. Without a proper agreement and transparent transfer, you risk not only financial penalties but even criminal consequences.

Lawyer’s recommendation

• For gifts worth hundreds of thousands or millions, always draft a contract.

• Use bank transfers, never cash.

• If you’re unsure about tax liability, consult before it’s too late.

Checklist:
☑ Written gift agreement prepared
☑ Transfer made via bank account
☑ I know whether the gift is taxable or exempt
☑ Proof of the source of funds ready

FAQ

Can I gift any amount of money?
Yes, there’s no legal ceiling.

Do I have to pay tax if I receive a million from my parents?
No – gifts from parents are exempt.

What about a gift from a friend?
If it exceeds CZK 15,000, you must declare and tax it.

Can the tax office ask about the source of the money?
Yes – especially for large sums. Always keep documentation.