Inheritance Tax

Q: I have been reading a lot in the news recently about children having to sell family homes in order to pay hefty inheritance tax bills. I am about to inherit my parents family home, what will this mean for me and my 3 siblings if we inherit our parents’ house, worth approximately  €1.2 million?

19th June 2015

With house prices rising across Ireland, this has pushed up the taxable value of an inheritance of a family home. A son or daughter is able to receive up to €225,000 tax free from their parents, in their lifetime. This tax free amount used to be as much as €434,000, however with the recession government decided to lower the threshold amount significantly, in line with falling house prices.

This will mean that, assuming that you or your three siblings have not received any prior gifts from your parents, you can each receive an inheritance amount of €225,000 tax free. Your share of the house will be €300,000, therefore you will be obliged to pay 33% capital acquisitions tax on the difference of €300,000 less €225,000, i.e €75,000. You will have an approximate inheritance tax bill of €24,750.

You should get in touch with your accountant for the correct advice and potential tax savings tips, as soon as possible.

Disclaimer: Advice shared in this blog is intended to inform rather than advise. Taxpayer's circumstances do vary and if you feel that the information provided is beneficial it is important that you contact us before implementation. If you take, or do not take action as a result of reading this forum, before receiving our written endorsement, we will accept no responsibility for any financial loss incurred.

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