Inheritance and Gift tax question.

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StaroftheSea

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Quote from revenue.ie:

"Once the taxable value of the gift or inheritance has been determined the amount of tax payable will depend on whether the appropriate tax-free threshold has been exceeded. The rates of tax are as follows-

The threshold amount - Nil
Excess 33%
*This rate was introduced on 6 December 2012."

On another page it tells me that the threshold for parent to sibling is 225,000.



I'm confusing two things here I'm sure. Can anyone shed any light on it for me?!

Am I correct in saying that:
1. I can receive 3000 a year from multiple disponers without incurring tax? (ex 3000 from one parent, 3000 from another parent, 3000 from a rich uncle etc)

2. I can inherit land to the current market value of 225000 before I begin to be liable for CAT at the rate of 33% on the balance?

3. Cash I inherit will be also taxed at 33% with no threshold for exemption?


Thanks,
Starof the Sea.
 
Am I correct in saying that:
1. I can receive 3000 a year from multiple disponers without incurring tax? (ex 3000 from one parent, 3000 from another parent, 3000 from a rich uncle etc)

2. I can inherit land to the current market value of 225000 before I begin to be liable for CAT at the rate of 33% on the balance?

3. Cash I inherit will be also taxed at 33% with no threshold for exemption?
Click to expand...

1. Yes small gift exemption.

2. Yes the first €225,000 is exempt the nature of the gift is not relevant property or cash is the same. There are specific reliefs in relation to dwelling houses, agricultural land and business assets.

3. No the threshold applies to lifetime gifts so if you are under €225,000 then the gift of cash is not taxed.
 
Your welcome and you should seek professional advice on your own particular circumstances.
 
HI
My wifes friend has received cash gifts from parents amounting to 30K. She has deposited the money in various bank accounts which she opened for the purposes. The money was paid in actual cash (not cheque or draft)

Should she need to give her bank statements to her accountant and explain the situation and will there be tax due?
 
Hi Finbar,

First of all she should ask her accountant who will be more familiar with her circumstances than you.

Capital Acquisition Tax is applied to the aggregate of gifts so if she has never received a gift from her parents before then there is no tax due. If she has received gifts before then, depending on the amount, she may have a liability. I could not possibly comment on the situation where someone gets 30k in cash and deposits it in different bank accounts.
 
Her parents withdrew the cash when the bank of scotland was due to close and kept it for a number of years before gifting it over to her.

They have managed to contact the BOS in the UK and to get a statement showing the withdrawal of the money. The accountant should be happy enough with that.
 
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