Most EU countries do not provide incentives for donors wanting to support a foreign beneficiary within Europe and outside Europe (USA, Canada, …). Income tax deductibility is not granted for donations made by individuals and corporate donors to foreign beneficiaries, while cross-border donations and legacies are often taxed at the highest applicable gift and inheritance tax rates.
It can be said that the environment for cross-border giving in Europe lags far behind in this borderless 21st century. The problem lies with burdensome legislation and heavy tax regulations that inhibit and, in some cases, prevent philanthropy and cross-border giving in Europe and beyond. In some countries, however, finding an effective solution will be easier than in others and the outcome depends on where the donor has his residency and his assets and in which country the beneficiary is located. With this in mind, it has to be stressed that cross-border giving is possible but still difficult and sometimes complicated. Therefore, cross-border giving in Europe needs to be improved and facilitated by securing tax-efficient giving free of fiscal and legal constraints to allow donors to express their philanthropy all across Europe. It will not mean that all donors will stop supporting national beneficiaries (cross-border philanthropy is still of marginal importance compared to national philanthropy) but it will ensure that the growing number of donors wanting to broaden their scope of action will be able to do so efficiently – and allow European cross-border philanthropy to fulfil its potential for dynamic change.
Besides the TGE network, for those interested by the EU and national developments dealing with cross-border philanthropy in Europe, it should be recommended to visit the Giving in Europe website. The Giving in Europe website www.givingineurope.org represents a valuable (free) resource for donors, intermediaries, and beneficiaries that wish to give or receive a cross-border donation or legacy. Here they will find practical information and initial advice on how to deal with the legal and fiscal aspects involved in the cross-border philanthropic transaction (gift or inheritance taxes to be paid, possible relief or exemptions, bilateral tax treaties, alternative solutions, etc.), taking into account the country of residence of donor and beneficiary and the country where the assets are located. The website will cover the 27 European Union countries as well as Switzerland
It gives also an update on the legal and fiscal developments on this topic and provides input on the advocacy initiatives in favour of a more favourable environment.
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