Inheritance from Aunt...

[Notemaker]

My aunt wants to give me some money towards my inheritance, she said it's better to give me money when I'm young and need it etc. She said it would be tax-free providing she doesn't pass away within 7 years of the gift.

I've lived all my life in N.Ireland (all my family connections are in N.Ireland), I started to work in Dublin around 3 years ago and last year I took out a mortgage to buy myself an apartment - I was sick of paying high rent. Due to the ongoing pandemic, I'd be living and WFH around 20 days per month (in Northern Ireland), the other 10 days I will pop down to the apartment in Dublin.
Before the pandemic, I would have been in Dublin Monday - Thurs and the rest of the days I would have been in the North, including my holidays etc - guess I'm a home bird.
My DR, dentist, car, car insurance etc are all registered to my Northern Ireland address but my work has my Dublin address (Revenue). I have a bank account in Northern Ireland and ROI. My eventual plan is to move back North in a few years. I'm currently single with no dependents etc.

If my aunt gives me a gift of around £90,000 will I have to pay tax on this? My plan was to pay off my mortgage in Dublin and be debt-free.

 

[Feemar5]

In the Republic the inheritance limit in your case would be Group B which is €32,500 from aunt to nephew/niece and the tax rate is 33%. I haven't heard anything about the 7 year limit.

CAT thresholds
You do not have to pay tax on a gift or inheritance if its value is below a particular group threshold. The threshold you use depends on your relationship to the person who gave you the gift or inheritance. You must pay tax on any remaining value above that threshold.
There are three group thresholds that apply from November 2011:
Group A
A son or daughter of the person giving the gift or inheritance (the disponer). Including certain foster children or a minor child of a deceased child of the disponer. Parents also fall within this threshold where they take an absolute inheritance from a child.
Group B
A parent (in respect of a gift or a [broken link removed]), brother, sister, niece, nephew, grandparent, grandchild, lineal ancestor or a lineal descendant of the disponer.
Group C
People with a relationship to the disponer not already covered in Groups A or B.
Note
Gifts and Inheritances taken by a Spouse or Civil Partner are exempt from Capital Acquisitions Tax.
CAT thresholds for inheritances or gifts

	Group A	Group B	Group C
On or after 9 October 2019	€335,000	€32,500	€16,250
10 October 2018 - 08 October 2019	€320,000	€32,500	€16,250
12 October 2016 - 09 October 2018	€310,000	€32,500	€16,250
14 October 2015 - 11 October 2016	€280,000	€30,150	€15,075
06 December 2012 - 13 October 2015	€225,000	€30,150	€15,075
07 December 2011 - 05 December 2012	€250,000	€33,500	€16,750

 

[mathepac]

If your aunt is UK resident, as seems to be the case with the gift in £, then Irish tax law may not apply. I'd speak to a tax lawyer or accountant in the North.

 

[Notemaker]

Thanks for your reply Feemar5.
My query is if I put the money into my bank in the North (considering I spend most of my time in the North), what tax implications could there be in the future? An accountant said she would classify me as an ROI resident (working and I have a property in ROI).

At one stage I was working in Ireland during the week and working a few hours in a local shop at the weekend in the North (paying tax on both) but due to an injury I stopped the weekend work in the North, I'm in the progress again of looking for a part job in the North.

I was considering paying off my mortgage in Dublin to be debt-free, eventually, I plan to sell my apartment in Dublin. Maybe I would be best off leaving the money in my bank account in the North and not bother paying off the apartment?

 

[RedOnion]

I haven't heard anything about the 7 year limit

It's a UK rule. The gift would become subject to tax in UK if the disponer dies within 7 years.

My query is if I put the money into my bank in the North

Which account you put the money into isn't relevant.
You're non Irish domiciled, and less than 5 years resident here. So it should be exempt from CAT in Ireland. You're only deemed to be resident here for CAT purposes after 5 years of being resident.