Trying to calculate gift tax - help needed.

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finance12

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Hi,
I have looked through the Revenue CAT info sheets but I'm still a bit unsure so hopefully someone can help.
My parents gave me some funds towards purchasing a house back in 2006 (I know, very lucky). It was well under the threshold level at the time which I think was around 400k (Group A Parent gifting Child), however I see now that the threshold has been drastically reduced and While the amount for the house would still have me under the limit they have given me smaller amounts of cash here and there over the years.
My question is, do I need to total all of these and apply the current threshold level of €250,000 to all of it and then pay tax on whatever I've received over €250k.
Hope the post isn't too confusing..... Thanks in advance
 
No, it doesn't work like that - that would make the tax retrospective and very unfair.

I use an example of how it works

You are now receiving a gift of 100k say. You need to calculate the value of all prior gifts received since 5th Dec 1991 let's say 400K in 2006 and 50k in 2008.

Step 1 calculate tax on current gift of 100k.

Taxable value of current gift is 100-3 = 97k (you can receive 3k tax-free from a donor every year)
Total value of all gifts received 400+50+97=547k
Current threshold is 250 so taxable value is 547-250 = 297
Tax due at 30% = 89,100

Step 2 Do same calculation excluding the current gift ie the 100k

Total value of all gifts received to date is 400+50=450k
Current threshold is 250 so taxable value is 450-250 = 200
Tax due at 30% = 60,000

Subtract to find tax due on current gift
89,100-60,000 = 29,100

This is also 97k x 30% - but the correct to arrive at this is as above.

Hope that helps.
 
Thanks a million - makes perfect sense.....even if does mean I am going to owe a lot of tax....!
Appreciate the reply
 
jpd is somewhat correct in some ways but fundamentally I'm afraid you are going to owe more tax should you take a gift from a class A disponer today.

Essentially you have received a prior gifts from a class A disponer of €400k and you take the small gift exemption of €3k off this leaving €397K

Current threshold is €250k

You class A is now wiped out (€397k exceeds €250k) so any gifts/inheritances from a Class A disponer this financial year will be subject to full CAT of 25%. You will not get any allowance unfortunately.
 
McCrack said:
jpd is somewhat correct in some ways but fundamentally I'm afraid you are going to owe more tax should you take a gift from a class A disponer today.

Essentially you have received a prior gifts from a class A disponer of €400k and you take the small gift exemption of €3k off this leaving €397K

Current threshold is €250k

You class A is now wiped out (€397k exceeds €250k) so any gifts/inheritances from a Class A disponer this financial year will be subject to full CAT of 25%. You will not get any allowance unfortunately.
Click to expand...

400 K was not the gift given - OP was referencing the threshold at the time
 
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