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Dublin: 23 °C Tuesday 4 August, 2020

Parent-to-children inheritance tax threshold to increase by €10,000

The tax-free threshold is to increase from €310,000 to €320,000

Image: Shutterstock/rafik beshay

MINISTER FOR FINANCE Paschal Donohoe has announced a €10,000 increase in the inheritance tax threshold from parents to children. 

Speaking before the Dáil, Donohoe said that he has decided to increase the lifetime Group A tax-free threshold, which broadly applies to transfers between parents and their children, from €310,000 to €320,000. 

Capital Acquisitions Tax is a tax on gifts and inheritances. 

People can receive gifts and inheritances up to a set value over their lifetime before having to pay CAT. 

The amount that a person might have to pay out depends on the relationship between the person inheriting and the deceased.

A spouse or civil partner is required to pay no tax.

For all other beneficiaries, a tax-free threshold amount is afforded, after which Capital Acquisitions Tax has to be paid.

Sons and daughters receive the largest tax-free amount. The second group is made up of parents, brothers, sisters, nieces, nephews and grandchildren and the third group includes any other type of relation.

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