Where a brother/sister inherits from another brother/sister and has received no previous gifts or inheritances from any other source since 2 December 1988, a tax free threshold of £25,720 applies. In the case of a child inheriting from a parent, the tax-free threshold of £192,900 applies. Each child in a family is individually entitled to this threshold amount.
The elderly siblings relief, introduced in 1991 and which I subsequently increased in the 1998 budget, takes account of the special circumstances of elderly brothers and/or sisters who have lived together for a period of five continuous years immediately prior to the inheritance and the recipient must not be beneficially entitled to any interest in any other dwelling house. The effect of this relief means that the value of an inheritance of a share or all of their family home taken from a brother or sister can be reduced by 80 per cent or £150,000, whichever is the lesser, subject to the conditions of the relief being met. A similar relief exists for other close relatives such as nephews or nieces who have been resident with the disponer of the inheritance for a period of ten continuous years. Thus such an individual could inherit a half share in a house, with a market value of just over £257,000, before any inheritance tax would be due.
As I have indicated to the Deputy, I am aware of the tax burden facing certain individuals, particularly on the inheritance of the family home where they have been residing and I am examining the capital acquisitions tax code in some detail in the context of the forthcoming budget.
The latest forecasted yield for 1999 from inheritance tax alone is about £106 million. This revenue greatly assists the Government's programme and helps achieve the ongoing goal of reducing the tax take on employment incomes. For this reason, any significant changes to the tax must be considered in a budgetary context.
Finally, possible hardship is taken into account by the Revenue Commissioners when determining the terms of payment of capital acquisitions tax. Where the threshold is exceeded, for example, payment by instalment may be arranged, and tax may be postponed in certain cases.