What is the case? Parents owned some houses and had in one of the houses stay their son with his family. No rent was due nor agreed upon and the parents could demand the son and his family to depart the house any given moment.
The tax office took the stand that the parents have given the son a gift. The gift being the rental value of the house which was not paid. The court decided differently. The court stated that if the assets of the parents do not decrease and the assets of the son do not increase, then there cannot be a gift. Hence, no gift tax.
If you know that when you rent out your house and the rental income is too low, you can valuate the house at 85% of the WOZ value in the Box 3 wealth tax part of the income tax return. That implies you save income tax over 15% over the economic value of your assets. At the same time you have provided your relates with housing.
Please note that this is a court decision and it can be overruled by a higher court decision. But for the time being you can have your children, or your parents or other relative stay for free in your house without gift tax being due.
