Questions and Answers
Capital Acquisitions Tax
Q. I received a gift from my uncle early this year. Do I have to file a tax return or pay any tax?
A. Capital Acquisitions Tax (CAT) is the tax that can apply to the person who receives any gifts or inheritances during their lifetime.
How much tax you have to pay depends on your relationship to the person you are receiving the gift/inheritance from.
There are three different tax-free thresholds. These thresholds depend on your relationship to the person making the gift or inheritance. You must pay tax when the total value of all gifts or inheritances received within any one group exceeds that threshold.
Group A - €310,000
A son or daughter of the person giving the gift or inheritance (the disponer).
Group B: - €32,500
A parent, brother, sister, niece, nephew or grandchild of the disponer.
Group C - €16,250
People with a relationship to the disponer not already covered in Groups A or B.
If the total value of gifts or inheritance is above 80% of your threshold amount, use Revenue Online Services (ROS) to complete your IT38 return. This is the case even if you are not due to pay CAT, as you have not exceeded the relevant group threshold. When calculating whether you have reached 80% of your group threshold, you should include all gifts received in the same threshold since 5 December 1991.
All gifts and inheritances with a valuation date in the 12-month period ending on the 31 August must be paid and filed by 31 October.
For example, if the valuation date is between 1 January and 31 August 2017, you must complete the tax return and pay the tax on or before 31 October 2017. If the valuation date is between 1 September and 31 December 2017 you must complete the tax return and pay the tax on or before 31 October 2018.
Date published 10 Aug 2017
This article is intended to inform rather than advise and is based on legislation and practice at the time. Taxpayer’s circumstances do vary and if you feel that the information provided is beneficial it is important that you contact us before implementation. If you take, or do not take action as a result of reading this article, before receiving our written endorsement, we will accept no responsibility for any financial loss incurred.Choose the right accounting firm for you
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