# Inheritance



## crobo (22 Aug 2008)

Hi,
My 3 siblings and I are due to inherit just under 500,000 euros worth of property from my dad. We will inherit equally so will each be, I believe, under the inheritance tax limit. In addition to the propery I am about to inherit I also own my own house and am getting a first time buyers allowance. Will that be affected in any way? Any other possible implications from a tax point of view?

If we choose to inherit the entire property now and choose to subdivide it later into 4 lots are there any implications there? Would it be better to do the subdividing now before we inherit?


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## Graham_07 (22 Aug 2008)

Group A Threshold is €521,208 for inheritances in 2008. Provided none of you have any previous gifts/inheritances from a parent then your respective 1/4 shares of the €500,000 would be under your thresholds and no CAT would be due. The inheritance of a share in this property would have no relevance to your other house ( presumably your PPR ) or the associated TRS or S/Duty relief.

If you are all inheriting it now then it is already owned 4 ways so subdivision into 4 down the line is not relevant. If you retain it and sell it at a future date then its value on inheritance would be taken as it's cost against any CGT due on a future disposal, should the disposal price then exceed the value now.


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## The MOB (22 Aug 2008)

Crobo, I'd love to need as much tax advice like you. Between asking VAT questions and inheritance tax questions your like someone asking questions on behalf of his/her own clients rather than referring them to someone who knows?


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## Iceman732 (22 Aug 2008)

I never actually noticed but The MOB is right, according to his posts Crobo is moving abroad, registering for VAT and now inheriting a house. He's also thinking about renting a house out!


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## BOXtheFOX (4 Sep 2008)

If a person is gifted a largish sum of money, say €50k+ from an elderly parent must that sum of money be disclosed to the revenue in the year it is received or can it form part of the overall tax return of the person when they receive their final inheritance on the death of the parent?


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## dazza21ie (4 Sep 2008)

BOXtheFOX said:


> If a person is gifted a largish sum of money, say €50k+ from an elderly parent must that sum of money be disclosed to the revenue in the year it is received or can it form part of the overall tax return of the person when they receive their final inheritance on the death of the parent?


 
You would need to do a return within four months of the date of the gift. Remember to take of the small gift exemption of €3,000.


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## BOXtheFOX (4 Sep 2008)

Thanks for that. Just to clarify the situation further. A person is gifted a largish sum of money, say €50k+ from an elderly parent in expectation of the parents death. There is a will in existance which states that the person to whom the money is being gifted will eventually inherit the elderly parents estate and that this €50k+ is being gifted prior to the death of the elderly parent as part of their inheritance. 
Can this €50k+ be rolled in to the inheritance tax calculations at a future date or must it be returned and taxed immediately?


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## Iceman732 (4 Sep 2008)

Can't take off the small gift exemption!!!!

Idiots


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## Sherman (4 Sep 2008)

Iceman732 said:


> Can't take off the small gift exemption!!!!
> 
> Idiots


 
No need to insult people who try to help others on this site.


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## BOXtheFOX (4 Sep 2008)

Iceman732 said:


> Can't take off the small gift exemption!!!!
> 
> Idiots


 
Can you clarify what you mean by the above?


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## Iceman732 (4 Sep 2008)

No insult meant at all. 

I mean exactly what I said......

Think about it for a second, what's the name of the exemption?? SMALL GIFT........ Is the gift of a house a small gift?

It's not like the €1,270 CGT allowance.

Go read IT39


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## asdfg (4 Sep 2008)

> If a person is gifted a largish sum of money, say €50k+ from an elderly parent must that sum of money be disclosed to the revenue in the year it is received or can it form part of the overall tax return of the person when they receive their final inheritance on the death of the parent?


 
If the substantial gift is less than 80% of the treshhold you do not have to advise revenue

See [broken link removed] When to file a Gift Tax Return?


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## Graham_07 (5 Sep 2008)

Iceman732 said:


> Can't take off the small gift exemption!!!!
> 
> Idiots


 


Iceman732 said:


> No insult meant at all.
> 
> I mean exactly what I said......
> 
> ...


 
As I understand it, S.69 CATCA 2003 allows one to deduct the first €3,000 (previously €1,270) of the total value of all gifts from any one disponer in any year. So the gift of a house value €300,000 from a parent would (a) be under the relevant group A threshold for parent to child (assuming no previous gifts/inheritances from that class) and (b) carry a value for CAT purposes of €300,000 - €3,000 = €297,000 for aggregation with any future gifts/inheritances and (c) be under the 80% of threshold used for CAT declaration purposes.

The exemption is not intended only for gifts of up to €3,000. It may be deducted from, say, a cash gift of €50,000 leaving an accountable gift of €47,000. In that respect it is, in fact, like the CGT annual exemption.


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## Sherman (5 Sep 2008)

Iceman732 said:


> No insult meant at all.
> 
> I mean exactly what I said......
> 
> ...


 
You're wrong, as Graham_07 has pointed out. BTW, when you call people idiots, insult is generally taken as being intended. Might be worthwhile for you to re-read the .


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## Roisinb (5 Sep 2008)

What is the Tax hear in Ireland on money inherited from a sister who lived and died in England?


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## BOXtheFOX (5 Sep 2008)

[broken link removed]

This is an 89 page document. Towards the end there are examples of people who inherit from overseas.


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## 4th estate (5 Sep 2008)

re the inheritance from a sister abroad, the rule is, if either the sister or yourself is resident or ordinarily resident in Ireland then Inheritance tax may be due depending on the value of the inheritance and the tax free amount you are entitled to as a sister.

As far as I know anyway.....


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## Iceman732 (5 Sep 2008)

Sherman said:


> You're wrong, as Graham_07 has pointed out. BTW, when you call people idiots, insult is generally taken as being intended. Might be worthwhile for you to re-read the .




Ok fair enough about the idiots comments but I find it really irritating when when people give ill-advised information. 

As for me being wrong about the €3,000 being taken off an inheritance, I'm sure you'll be delighted to know that I am in fact correct. 

If I could refer you to CATA76 S53 and CATCA S69 and as Graham mention S69 CATA 2003:

Just to clarify the point for anyone who hasn't got legislation beside them, the €3,000 cannot be taken off an inheritance! The OP speaks of inheriting a house etc... Therefore in computation he will not be able to deduct the €3,000

As I mentioned before, the name of the exemption is the small gift exemption. A gift is not an inheritance. So in the situation of a gift the €3,000 can be taken off the total amount, naturally various restrictions apply. 

Should anyone need further information on Capital Acquisitions Tax I recommended you seek professional advice because the information given in this thread does not appear to be particularly accurate. 

Sherman it might be worth while reading the relevant legislation or purchasing a taxation summary and reading it thoroughly.

Iceman


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## Graham_07 (7 Sep 2008)

BOXtheFOX said:


> If a person is *gifted *a largish sum of money, say €50k+ from an elderly parent must that sum of money be disclosed to the revenue in the year it is received or can it form part of the overall tax return of the person when they receive their final inheritance on the death of the parent?


 


Iceman732 said:


> The OP speaks of inheriting a house etc... Therefore in computation he will not be able to deduct the €3,000


 
The question from Boxthefox was what I was answering, not the OP, perhaps I should have quoted that poster for clarity  in my response. The thread ( as frequently happens on AAM) seemed to expand from the OP's original question. Quite correctly S.69CATCA2003 does not apply to inheritances, but in the question Boxthefox posed, it would as it was a gift.

I endorse your comment re seeking appropriate professional advice. One should never rely solely on anonymous posts on an internet forum in making taxation decisions.


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## Iceman732 (7 Sep 2008)

Graham_07 said:


> The question from Boxthefox was what I was answering, not the OP, perhaps I should have quoted that poster for clarity  in my response. The thread ( as frequently happens on AAM) seemed to expand from the OP's original question. Quite correctly S.69CATCA2003 does not apply to inheritances, but in the question Boxthefox posed, it would as it was a gift.
> 
> I endorse your comment re seeking appropriate professional advice. One should never rely solely on anonymous posts on an internet forum in making taxation decisions.




Agreed!


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## dazza21ie (7 Sep 2008)

Iceman732 said:


> Ok fair enough about the idiots comments but I find it really irritating when when people give ill-advised information.
> 
> As for me being wrong about the €3,000 being taken off an inheritance, I'm sure you'll be delighted to know that I am in fact correct.
> 
> ...


 
Perhaps you should read the thread fully before jumping in and calling people idiots. The reference to the small gift exemption was in fact correct and you made a very lame attempt at apologising.


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## Iceman732 (7 Sep 2008)

dazza21ie said:


> Perhaps you should read the thread fully before jumping in and calling people idiots. The reference to the small gift exemption was in fact correct and you made a very lame attempt at apologising.



Dazza,

I so so sorry!! You have to love father Jack!


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## Lorlo (25 Nov 2008)

Hello, I would really appreciate some advice thanks. An elderly relation wants to leave his house to be jointly shared between myself and my daughter (now aged 13) when he dies. While it is the nicest thing anyone can do for you, I'm sick with worry. He wants to include a clause in the will stating that we cannot sell the property until my daughter is aged 21. The reason I am so worried is that, combined with my own house, I will have what will effectively be a second mortgage because of the scale of inheritance tax I will have to pay and won't be able to afford this. Does anyone have any suggestions where it could work out ok. I'm in a position where I am going to have to refuse his offer if it comes to that.


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## 4th estate (25 Nov 2008)

Lorlo said:


> Hello, I would really appreciate some advice thanks. An elderly relation wants to leave his house to be jointly shared between myself and my daughter (now aged 13) when he dies. While it is the nicest thing anyone can do for you, I'm sick with worry. He wants to include a clause in the will stating that we cannot sell the property until my daughter is aged 21. The reason I am so worried is that, combined with my own house, I will have what will effectively be a second mortgage because of the scale of inheritance tax I will have to pay and won't be able to afford this. Does anyone have any suggestions where it could work out ok. I'm in a position where I am going to have to refuse his offer if it comes to that.



You could rent the house out until daughter reaches 21. The rental income will be subject to Income Tax although I don't think any will be due from your daughter.

The rental fund could pay for the Inheritance tax  over 5 years on a statutory instalment arrangement with Revenue. Or you could take out a mortgage over a few years, with the rental income more or less covering the cost.


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## Lorlo (27 Nov 2008)

Thank you 4th estate. for the advice. Yes I suppose that that would be the best and possibly my only option, just I am currently a one income household that is managing just fine, I worry about how another mortgage would impact my life and my daughters if I were eg. to lose my job!


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