Are Gifts or Inheritance Divided at Divorce? Vancouver Lawyer explains

Are gifts or inheritances divided at the time of separation? Depends… who is the gift coming from? was it given during the marriage or before the marriage? What if the inheritance appreciated in value? What if it was gifted and then given to someone else as a gift (i.e. Christmas presents)? Are gifts and inheritances treated the same under our BC Family Law Act?  Our Vancouver Property Division lawyers explain all that jazz below:

Gifts or Inheritances Received from Third Parties – Property Division Lawyer Explains

Before or during your marriage or relationship, you may receive gifts or inheritances. Some may be small and some may be large. But the BC Family Law Act doesn’t care. It says that if you receive a gift from a third party, meaning your mom, dad, boss, etc, it is not divisible at the time of separation. This means you can keep your gifts whether they are $10 or $1 million dollars.

But if you receive a gift from your spouse or husband/wife, that gift gets divided at the time of separation, usually 50/50. So if your husband gave you a diamond ring, he can ask for half of it back. Or if you had a house given to you by inheritance but put your wife or husband’s name on it 50/50, that means you ‘gifted’ 50% of the house to your spouse, and if you want to ask for the whole thing back, you are pretty much dead in the water.

Gifts Having More Value at the Time of Separation

If your parents left you a house as an inheritance or gifted it to you during or before marriage, then at the time of separation and if you live in Vancouver, the value of the house will have for sure gone up. These days it would pretty much double in a year. So is your spouse entitled to any of the increase in value at separation? You bet he/she is.

The Family Law Act says that the appreciation in the value of the gift or inheritance during the relationship or marriage is divisible – most times on a 50/50 basis. So this means you keep the ‘principle’ but you split the ‘profit’.

Gifts Having Less Value at the Time of Separation

If let’s say you got a nice gold necklace from you sister and at the time of separation, it was worth less, then you get to keep the gift but your spouse does not have to pay you back 50% of the decrease in value. So let’s say you got a car as a gift or inheritance which was worth $20,000. At the time of separation it was worth $10,000. You can’t say your spouse has to pay you 50% of the depreciation in value. This bit makes sense, I know.

If your spouse gifts you a gift and it goes down in value by separation, again you can’t ask your spouse to give you 50% of the decrease in value. This also makes sense.

More important however is the interplay between gifts and other family property and how they are divided as a pool. This conversation is very complex and if you are in this situation, make sure you call our award-winning property division family lawyers for a consultation at 604-974-9529 or email [email protected].