Paul Kehoe
Question:110. Deputy Paul Kehoe asked the Minister for Finance if there is an exemption from capital acquisitions tax in a scenario (details supplied); and if he will make a statement on the matter. [7942/18]
View answerThursday, 15 February 2018
Questions (110)
Written answers
I am informed by Revenue that for gift tax purposes, the relationship between the person who provides the gift (i.e. the disponer) and the person who receives the gift (i.e. the beneficiary) determines the maximum amount known as the “Group threshold” below which gift tax does not arise.
There are three separate Group thresholds based on the relationship of the beneficiary to the disponer. The Group A threshold (currently €310,000) applies, inter alia, where the beneficiary is a child (including adopted child, step-child and certain foster children) or minor child of a deceased child of the disponer. The Group B threshold (currently €32,500) applies where the beneficiary is a brother, sister, a nephew, a niece or lineal ancestor or lineal descendant of the disponer. The Group C threshold (currently €16,250) applies in all other cases.
Any prior gift or inheritance received by a beneficiary since 5 December 1991 from within the same Group threshold is aggregated for the purposes of determining whether any tax is payable on a benefit. Where a person receives gifts or inheritances which are in excess of their relevant tax free threshold, CAT at a rate of 33% applies on the excess over the tax free threshold.
There are no exemptions from CAT for the gifting of a site. The gift tax that would be payable in the circumstances set out by the Deputy would depend on the value of the site in question, how the benefit is distributed among the beneficiaries and whether each beneficiary had received previous gifts or inheritances within his or her relevant Group threshold. The daughter’s partner would be in the Group C threshold even if he was married to her, as he is not a relative of the disponer under Groups A or B.
There is an exemption from capital gains tax where an individual transfers a site to his or her child to enable the child to build a house on the site to be occupied by that child as his or her only or main residence. In order to qualify for the exemption, the value of the site must not exceed €500,000 and the area of the site must not exceed 0.4047 hectare (1 acre).