About Gift/Inheritance Tax
This tax is officially called Capital Acquisitions Tax (CAT) and applies to the beneficiary of an inheritance or gift.
The value of the benefit received which is subject to tax is reduced by an allowance know as the group threshold; there are three group thresholds which are based on the relationship between the giver (donor) of the gift or inheritance and the receiver (referred to as a donee [gift] or successor [inheritance]).
CAT is a self-assessed tax.
• Group A lifetime threshold applicable to transfers from a parent to a child is € 310,000.
• Group B lifetime threshold applicable to transfers between blood relatives. Currently € 32,500.
• Group C lifetime threshold applicable to transfers between strangers. Currently € 16,500.
These thresholds relate to the maximum tax free amount receivable in a lifetime from any donor as opposed to per donor. i.e. the maximum combined amount receivable in a lifetime from all parents is €310,000.
The main body of legislation governing the taxation of gifts and inheritances in Ireland is the Capital Acquisition Tax Consolidation Act 2003 (CATA 2003).
At times CAT may arise on a transaction on which CGT has already been paid (by the person making the gift). In such circumstances the CAT will be reduced by the CGT already paid.