Question 1

What is Capital Acquisitions Tax (CAT)?

Accepted Answer

Capital Acquisitions Tax, is a tax on gifts and inheritances in Ireland. The tax is payable by the beneficiary who receives assets from a gift or an inheritance, and is calculated by reference to the value of the gift, the relationship between the beneficiary and the donor, and the thresholds applicable at the relevant date.

Question 2

Who is liable to Capital Acquisitions Tax?

Accepted Answer

If any of the below conditions are met then the assets are liable to CAT:

The beneficiary is tax resident or ordinarily resident in Ireland at the date of the gift or inheritance.

The disponer or transferor is tax resident or ordinarily resident in Ireland at the date of the disposition.

The asset is situated in Ireland.

Question 3

What is the rate of CAT?

Accepted Answer

The rate of CAT is currently 33% and it applies to any benefits received in excess of the relevant thresholds after any applicable reliefs have been claimed

Question 4

Can I receive any gifts or inheritances without paying tax?

Accepted Answer

Yes, each person is allowed to receive gifts and/or inheritances up to the relevant group threshold before they must pay CAT. The thresholds ae currently:

Group A (Most commonly parent to child)  €400,000
Group B (Close blood relatives)                      €40,000
Group C (Others)                                                 €20,000

A complete analysis of thresholds and qualification criteria can be found here - CAT groups and group thresholds.
You can also received gifts under the small gift exemption of up to €3,000 per disponer each year without impacting on the above thresholds.

Question 5

Are there any reliefs to reduce how much tax I must pay?

Accepted Answer

Yes, the most common reliefs used are Dwelling House Relief, Agricultural Relief and Business Property Relief. Please see our Knowledge Base (link embedded) to find out more about these and other reliefs available

Question 6

What is the Tax Calculator?

Accepted Answer

Our free to use Tax Calculator will provide you with an indicative tax liability based on the information you provide.

Question 7

When am I required to file a tax return?

Accepted Answer

If you exceed 80% of the relevant group threshold and/or claim a relief then you must file a CAT return.

Question 8

What date must I file a return by?

Accepted Answer

If the valuation date is between 1st January and 31st October then you must file by the 31st October of that year. If the valuation date is between 1st September and 31st December then you must file by the 31st October of the following year.

Question 9

When is payment of CAT due?

Accepted Answer

Payments dates are the same as the filing dates above.

Question 10

What are the penalties for not filing and/or late payment?

Accepted Answer

A surcharge of 5% of the tax due applies for filing the return within 2 months of its due date whilst a 10% surcharge applies to filings in excess of 2 months of the due date.
Interest may also be charged on late payments. The current rate of interest is 0.0219% per day. A lower rate applies to CAT due on agricultural property and relevant business property if it is being paid by instalments.

Question 11

What is valuation date?

Accepted Answer

For gifts, the valuation date is generally the date you receive it
For inheritances, the valuation date is the earliest of the following:
The date the executor or administrator is entitled to retain the asset for your benefit,
The date on which the asset is retained, or
The date the executor or administrator gives the asset to you
The valuation date is the date of death if:
Someone gives you a gift in anticipation of their death
There is a failure to exercise a power of revocation, or
The property passes by survivorship.

Question 12

I live abroad – does Irish CAT apply to me?

Accepted Answer

If either the beneficiary or the disponer is Irish tax resident or ordinarily resident, or the assets are located in Ireland then Irish CAT will apply.

Question 13

Is TaxPlanner right for me?

Accepted Answer

If you have come this far then we are confident to say we are the right advisor for you. The majority of our clients have wealth of between €500,000 and €2,500,000 which can consist of the following:
Business assets
Agricultural assets including leased land
Rental portfolios
Savings and investments including pensions
We help to plan for the future to ensure the next generation pay the minimum amount of tax on what you have worked so hard for, whilst ensuring that your wishes take precedence
We also work with clients who have wealth levels either above or below the above.

Question 14

I already have an accountant – can I work with TaxPlanner?

Accepted Answer

Absolutely, we often work directly with other accountants to assist them with tax planning for their clients who they have referred to us, or we can give you a second opinion on advice you have previously received.

Question 15

I want to make a will, can TaxPlanner review it to ensure it is tax efficient?

Accepted Answer

Yes, this is a common service and we can work directly with your solicitor who is writing your will or we can provide a template for them to complete your will.

Question 16

I am worried about a potential CAT liability that I will have in the future, can you speak to me without the disponer being involved?

Accepted Answer

Yes we can work with you to ensure that you will qualify for any relevant reliefs and be prepared for a potential tax liability.

Question 17

How do I contact TaxPlanner to start planning for my legacy?

Accepted Answer

You can call us on 019653520 or click on this link (embedded to booking link) to book an appointment today.
Alternatively complete our free Tax Calculator (embedded link) and we will be in touch with you.

FAQ

Frequently asked questions