Do you know about our Tax Games It’s Friday (TGIF) posts?
Tax Games It’s Friday is a fun way for our clients and followers to get answers to their every day tax questions. Whether it’s a question about deducting your dog on your income taxes or when is the best time to be born for tax purposes, we’ve got the answers!
In November 2018, Gilmour Group CPA’s started a weekly campaign called Tax Games It’s Friday (TGIF). Every Friday we post a question and answer related to tax, similar to our weekly FAQ’s, however these questions can be related to anything from purchasing an asset, to current events in the media, even to where Santa Claus would have to pay income tax. These posts have been a hit so far and even give our followers a bit of a laugh to end their week. Here is an example of one of our Tax Games It’s Friday questions:
Was the engagement of Meghan Markle to Prince Harry a taxable event??
Not many people realize that when they get married or divorced until after they are married or divorced that there is a possible tax? Looking earlier than that, is getting engaged taxable?
A) Yes, Prince Harry proposing to Meghan Markle was taxable.
B) No, you are crazy.
Love is not taxable My bet is on B, but I think the real answer is that it depends if the engagement happened in Canada. If it did, there is no gift tax. If the engagement happened in the USA, there could be tax because Meghan Markle is a US citizen and bound by US gift tax. The answer is that, as far as we know, the engagement happened in the U.K. In the U.K., there is a gift tax. However, it is tied into inheritance tax. That makes the analysis of whether the gift was taxable a bit of a challenge. My understanding is that we need to wait 7 years and see if Harry dies. That would retroactively trigger gift tax. If you are a U.K. Gift tax expert, please let us know with an answer, thanks.