Key Post Guide to Capital Acquisitions Tax (Gift Tax and Inheritance Tax)

Brendan Burgess

Brendan Burgess

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Capital Acquisitions Tax – 2011 Group Thresholds - Note that the 2012 thresholds will be lower

The Capital Acquisitions Tax Group Thresholds for gifts and inheritances taken in the calendar year 2011 are as follows:

Revenue Guide to Group Thresholds


Group A €332,084- Applies where the beneficiary is a child (including adopted child, step-child, and certain foster children) or minor child of a deceased child of the disponer. In certain circumstances parents also fall within this threshold where they take an inheritance from a child.


Group B € 33,208 - Applies where the beneficiary is a brother, sister, niece, nephew, or lineal ancestor or lineal descendant of the disponer.


Group C €16,604- Applies in all other cases.

See
Citizens Information Guide to CAT
 
Example of simple calculation for 2011 tax year

"the first €3,000 of all gifts taken by a donee from one disponer in any calendar year."

So if a parent gives a son €503,000. Is it calcualted as follows:

Gift |€535,084
less annual exemption|€3,000
Less threshold|€332,084
Taxable|€200,000
 
In certain circumstances parents also fall within this threshold where they take an inheritance from a child.


Any idea what these circumstances might be.
 
from Citizens information

Group A also applies to parents who take an inheritance from their child but only where the parent takes full and complete ownership of the inheritance. If a parent receives an inheritance where he or she does not have full and complete ownership of the benefit, or if a parent receives a gift, then Group B applies.
If a parent inherits from their child, and have full and complete ownership of the inheritance it is exempt from tax if, in the previous five years, the child took an inheritance or gift from either parent and it was not exempt from Capital Acquisitions Tax. In this case, no tax needs to be paid even if the inheritance from the child is over the threshold.
 
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