Tax guidance published on 14 September 2026 clarifies Box 3 actual-return treatment of a revocable paper gift. Creating or revoking the principal produces no capital growth in the stated case. Interest counts when paid, so payment dates and bank records matter.
Why this matters
A paper gift leaves the parent with a private debt and the child with a receivable. Both positions need Box 3 reporting and valuation. Interest uses private cash and counts when it reaches the child’s account. A spreadsheet entry is not a payment. For founders and owner-managers, the annual transfer can compete with tax reserves, mortgage costs, and other private bills. Keep the deed, bank record, and both tax returns aligned.
Example
The case covers a €50,000 paper gift with 6% annual interest. The parent keeps the cash, while the principal falls due after death. The parent can revoke the gift. A full year produces €3,000 of interest. Once paid, it is negative regular income for the parent and regular income for the child in the Box 3 actual-return calculation. Making or revoking the €50,000 principal is neutral. During the arrangement, the debt and receivable still require reporting and valuation.
XTROVERSO tips
- Match the deed to the records. Check the deed against private records. The amount, interest rate, payment terms, and revocation clause must match.
- Trace the annual payment. Keep the interest calculation with the bank statement. Check the amount, payment date, and receiving account.
- Compare both tax returns. Match the parent’s debt to the child’s receivable. Put paid interest in the correct tax year.
- Put the payment in the cash plan. Set aside private cash for annual interest. Do not use money that needs to stay in the company.
- Review changes before recording them. A different rate, payment pattern, or repayment term may change valuation or tax treatment. Record a revocation decision and its effective date.
Need the deed, payments, valuation, and tax records checked? We can review the file with you
The data, sourcing, and analysis behind this article were conducted by Linda Pavan. AI was not used to identify sources, build the factual basis, or produce the analytical judgment contained here. AI was used only as a drafting aid. The final English text was personally reviewed, edited, and approved by Linda Pavan before publication.
References
- KG:202:2026:12 Herroepelijke schuldigerkenning uit vrijgevigheid en box 3 | Kennisgroepen Belastingdienst
- Belastingdienst - Current Box 3 reporting and valuation of paper gifts
- Kennisgroepen Belastingdienst - Valuation discipline for private receivables and debts
- Belastingdienst - Inheritance-tax conditions and actual payment of interest
- Belastingdienst - Current actual-return counter-evidence regime
- Rijksoverheid - Forthcoming structural Box 3 regime
