Stamp duty on inheritance

Hoping someone can give feedback on this scenario:

The Will leaves "residue" of estate to equally to 2 children, i.e. whatever is left after specified items are paid out, bills paid etc.

The residue will include one property and shares etc which will be sold in full so will be cash.

Child A is not interested in the property, and Child B would like to take it in full. Child A & B are in agreement about this arrangement, are in agreement on the value that the executor has put on the property based on an independent survey, and the executor/lawyers are happy to accommodate this.

Both Child A and Child B will exceed their threshold in the above scenario. Say house is worth 300k and there is 700k in cash. So Child A would end up inheriting property plus 200k, Child B would inherit 500k.

Are there any stamp duty implications for Child A? Or would both Child A & B pay tax on whatever exceeds their allowance as children?

So to clarify:

Child A gets half a house and 350 in cash - 500 K
Child B gets the same. - 500 K

They both pay CAT on the excess over threshold

Child B sells their share of the house to Child A for 150 K and Child A pays stamp duty of 1% on B's half to Revenue. A already owns one half of the house.

mf

Thanks for the reply mf1.

Is that they way it has to be treated?

Child A is not a resident in Ireland, is the stamp duty payable still the same? The property will be used for rental income for Child A.

"Is that they way it has to be treated?"

I imagine I'll be corrected if I'm wrong!

And stamp duty is the same whether resident or not. They'll need a PPS number for stamping

mf

Is there a specific power of appropriation in the will?

Sorry Vanilla, I'm not sure what that means, but the will does not split the residue or assign it to one or other in any way.

Are you sure? It's a standard "wrapping up" clause.

Otherwise what is exec expected to do with any sum of money remaining?

What sum of money remaining? If the "residue" is divided as per the wishes, there cannot be a sum remaining. Anything that's left after specific legacies are paid out forms the residue for A & B.

Ask the solicitor dealing with it, but basically it would be a power written into the will giving the legal per reps a power to appropriate assets. If it is in the will, there should be no stamp duty as the per rep can simply assent to the vesting of the asset in the beneficiary.

Think we are at cross purposes here. The residue *is* the remainder after all debts & expenses paid.

Thanks for the input. I'll ask about a power of appropriation.

mf1 said:

So to clarify:

Child A gets half a house and 350 in cash - 500 K
Child B gets the same. - 500 K

They both pay CAT on the excess over threshold

Child B sells their share of the house to Child A for 150 K and Child A pays stamp duty of 1% on B's half to Revenue. A already owns one half of the house.

mf

Click to expand...

Why would the house be passed down between A and B. Why not directly to A?

I'm not sure the executor is entitled to do that, the will leaves the residue equally to both

Sorry to drag up an old post but I have just been through this situation and thought it might be useful for future thread searchers to know the actual Revenue position. In the exact scenario as outlined in the first post, where the person taking the house has enough inheritance to do so without having to pay extra to the other beneficiaries then *no* stamp duty is payable. It looks like this isn't a well know position (and in fairness it probably isn't a situation a lot of people are lucky enough to face). The current Revenue guidance is very vague on this area and on querying it they responded with the same guidance note but with extra text that clarified that stamp duty is only applicable if the beneficiary is getting more than they were entitled to in the will - i.e. a redistribution of assets that kept everybody within their inheritance amount does not attract stamp duty. Saved a few grand and was a real eye opener for my solicitor.

that' good to know. So in the original post where the value of the estate was 1 million and so each received 500,000 each then only Capital Acquisition Tax is applied. Am I correct.