Dáil Éireann debate -
Thursday, 8 Apr 1993

Vol. 429 No. 5

Written Answers. - Property Gifted.

Bernard J. Durkan

Question:

27 Mr. Durkan asked the Minister for Finance the extent to which an aunt or uncle can dispose of a housing site to a niece or nephew without their incurring either gift or capital gains tax particularly in the case of a person (details supplied) in County Kildare; and if he will make a statement on the matter.

Minister for Finance (Mr. B. Ahern)

I am informed by the Revenue Commissioners that the amount of capital acquisitions tax payable is a function of the value of the property gifted, the aggregation, where relevant, of prior benefits and the relationship of the disponer to the beneficiary.

In the absence of full details of prior benefits it is not possible to define the value at which a gift becomes taxable. However, the current threshold for purposes of a benefit taken from an uncle or aunt is £22,900. Where this threshold is exceeded the following rates of capital acquisitions tax apply to the excess:

First	£10,000	over threshold	—20%
next	£40,000		—30%
next	£50,000		—35%
balance			—40%

Where the benefit is taken by way of gift as opposed to inheritance, the liability to capital acquisition tax is calculated at 75 per cent of the above rates. In addition, the first £500 of the taxable value of a gift is exempt from tax.

No special relief is available under the Capital Gains Tax Acts on the disposal of housing sites by an aunt or uncle to a niece or nephew. If the consideration received from the disposal of the site exceeds the current use value of the land disposed of, the provisions of sections 36-40 of the Finance Act, 1982, relating to gains on disposals of development land, come into effect.