CAT gift splitting rule

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fistophobia

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Consider this scenario;

A parent inherits a property from elderly relative, then decides to sell it, and give proceeds to her children.
I am reading on Revenue website - if dispursed within 3 years of the original inheritance, its considered a gift from the earlier person.

What if the parent gifts her children cash before the inheritance is done. Is this allowed, for CAT tax rate of category A (parent to child).

thanks
 
fistophobia said:
Consider this scenario;

A parent inherits a property from elderly relative, then decides to sell it, and give proceeds to her children.
I am reading on Revenue website - if dispursed within 3 years of the original inheritance, its considered a gift from the earlier person.

What if the parent gifts her children cash before the inheritance is done. Is this allowed, for CAT tax rate of category A (parent to child).

thanks
Click to expand...

The three-year rule is three ways in both directions, both before and after.

It only applies to gifts - so there is no issue with an inheritance.

If the "inheritance" was actually a gift, then no it is not allowed.

Nor does it matter whether the cash comes from the sale of the house or from other savings
 
So just to clarify, the house was received as inheritance then the sale proceeds are not subject to the 3 year rule.
 
This is very good advice.
I spoke to Revenue, and they confirm this is correct.
First action is inheritance, second is gifting.
The children can avail of category A allowance for CAT purpose.
 
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