A: From 14 October 2015 the lifetime limit that can be gifted from Father/Mother to Son/Daughter (Group A threshold) has increased from €225,000 to €280,000. This means you can receive a gift or inheritance up the value of €280,000 from your parents, within your lifetime, without paying any CAT tax. If for example the house was worth €300,000, you will only be liable to pay tax on the amount over the €280,000.
The excess, in this case €20,000, over the threshold is chargeable at 33%. It’s worth remembering the annual small gift exemption is still in place. This means the value of your taxable gift can also be reduced by €3,000.
You may also wish to wait until next year’s budget before receiving the gift as it is expected the CAT rate will rise again.
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.