Death and Taxes: Capital Acquisitions Tax (CAT) in Ireland

You may be in the fortunate position of receiving a generous gift from a family member this year. Or perhaps you have lost a loved one and inherited some assets from them.

Whether it’s a gift or an inheritance, you need to be aware of Capital Acquisitions Tax (CAT) and the rules surrounding it.

What Is Capital Acquisitions Tax?

CAT is commonly referred to as Gift Tax or Inheritance Tax. A gift is a benefit received from someone who is alive, whereas an inheritance is a benefit taken from someone who has passed away.

Examples of gifts or inheritances:

Cash
Jewellery or a car
House or land
Stocks and shares
The free use of a house for life
An interest-free loan

How Is CAT Applied?

The benefit (gift or inheritance) is taxed if its value exceeds a certain threshold. Different tax-free thresholds apply depending on the relationship between the disponer (the person giving the benefit) and the beneficiary (the person receiving the benefit). There are also exemptions and reliefs depending on the type of gift or inheritance.

For example:

If you receive a gift or inheritance from your spouse or civil partner, you are exempt from CAT.
You do not pay CAT on a gift valued at €3,000 or less from any one person in any one year. This exemption does not apply to inheritances.

CAT applies to all property located in Ireland. It also applies to property outside Ireland if either the disponer or beneficiary is tax resident in Ireland.

CAT Thresholds

The new CAT thresholds were updated in Budget 2027 and came into effect on 07 October 2026.

Group	Relationship	Threshold
Group A	Child (including stepchild, adopted child, and certain foster children)	€420,000
Group B	Parent, grandparent, grandchild, great-grandchild, brother, sister, nephew, niece	€44,000
Group C	Any relationship not included in Group A or B	€22,000

If the date of the inheritance or gift was before 07 October 2026 then the old thresholds apply:

Group	Relationship	Previous Threshold - 02 Oct 2024 to 06 Oct 2026
Group A	Child (including stepchild, adopted child, and certain foster children)	€400,000
Group B	Parent, grandparent, grandchild, great-grandchild, brother, sister, nephew, niece	€40,000
Group C	Any relationship not included in Group A or B	€20,000

Exceptions

If a grandchild is under 18 and receives a gift or inheritance from a grandparent, Group A may apply if the grandchild’s parent is deceased.

If you are passing your business on to a niece or nephew who has been involved in running it and is ready to take over, you may be able to avail of Favourite Niece/Nephew Relief.

CAT on Foreign Property

Under CAT rules, Capital Acquisitions Tax (CAT) is due on the value of inherited property or assets if either the person leaving the inheritance or the person receiving it is tax resident in Ireland at the time of the inheritance. It should be noted that taxes may also be due in the country where the property is situated and you would need to ensure that all tax liabilities are calculated and settled there as well.

Also, CAT is always due on assets located in Ireland, regardless of where either person is tax resident.

How Is CAT Calculated?

CAT is charged at 33% on gifts or inheritances above the threshold.

For example, if you receive gifts from your parents worth €750,000, you only pay tax on the amount above the Group A threshold (€440,000).

So, €320,000 is taxed at 33%.

CAT Filing Requirements

You must make a tax return if the total value of gifts and inheritances you have received in one of the groups (A, B, or C) since 5 December 1991 exceeds 80% of the tax-free threshold for that group.

For example:

If you receive a €15,000 gift from a sister and a €18,000 inheritance from a grandparent, both fall under Group B.
The total amount received is €33,000, and the Group B threshold is €44,000.
Since 80% of the threshold is €35,200, you do not owe tax but must file a tax return.

CAT Payment Deadlines

All gifts and inheritances with a valuation date in the 12-month period ending on 31 August must be paid and filed by 31 October. The valuation date is the specific date on which the official open-market value of an inherited asset is fixed for tax purposes. It is also the critical date that determines the deadline for when you must file your tax return and pay any inheritance tax due.

For example:

If the valuation date is between 01 January and 31 August 2025, you must file and pay by 31 October 2025.
If the valuation date is between 01 September and 31 December 2025, you must file and pay by 31 October 2026.

How to File a CAT Return

CAT returns must be filed electronically using Revenue’s Online Service (ROS). In limited circumstances, a paper return can be submitted.

We Can Help

Filing a CAT return can be a complex and time-consuming process, especially when you're navigating exemptions, thresholds, and deadlines. Fortunately, you don't have to manage it alone. A qualified accountant can handle the return on your behalf, ensuring everything is filed accurately and on time. At TaxAssist Accountants, we offer expert support to guide you through every step of your CAT obligations, making the process as smooth and stress-free as possible. Contact us today.

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Last updated: 22nd October 2026