I am advised by the Revenue Commissioners that chargeable gains arising on the disposal by the beneficiary of all or part of an inheritance from a parent will be liable to capital gains tax, notwithstanding that the beneficiary has been the registered owner for more than ten years.
The chargeable gain is the difference between the net sale proceeds, after deducting the incidental costs of sale, and the allowable expenditure, that is, the aggregate of the market value of the asset on the date the parent died and the cost of any enhancement expenditure incurred by the beneficiary, after adjusting both for inflation up to 31 December 2002. The first €1,270 of an individual's annual gains are exempt from capital gains tax. The excess is chargeable at 20%.
The liability will be relieved, wholly or partially, where the beneficiary is entitled to relief, for example, on the disposal of his or her main residence or certain business assets. This relief is subject to conditions. On the information given, it appears that the beneficiary is not liable to taxes other than capital gains tax on the disposal in question.