CAT is the tax on gifts and inheritances.
- It applies when you inherit or receive a gift over a taxfree threshold.
- The amount you can receive taxfree depends on your relationship to the giver, divided into thresholds (closest relatives get the highest threshold).
- Previous gifts or inheritances in your lifetime are aggregated and taken into account.
- Anything above the combined threshold is taxed at 33%.
- CAT is paid by the person receiving the gift or inheritance.
- Irishsituated property can be liable to CAT even if the people involved live abroad.
Some gifts or inheritances can attract tax relief, for example:
- Agricultural Relief
Reduces the taxable value of qualifying farmland and buildings by 90%, if conditions are met (e.g. beneficiary is a farmer). - Business Relief
Reduces the taxable value of qualifying business assets (including shares in trading companies) by 90%. - Dwelling House Exemption
Full exemption where the beneficiary lived in the house for 3 years before the inheritance and continues to live there for 6 years after, and does not and has never owned another home. - Heritage Property Relief
Exemption or reduction for properties of national, historic, artistic or scientific importance, subject to public access and upkeep conditions.
Some gifts can be made tax free, for example:
- Small Gift Exemption
You can receive up to €3,000 per year from each person completely taxfree. This does not reduce your lifetime CAT threshold. - Gifts within CAT thresholds
Gifts are taxfree until your lifetime threshold is exceeded, based on your relationship to the giver. - Spouse or Civil Partner Gifts
All gifts between spouses or civil partners are fully exempt from CAT, no matter the amount.