Date Gift Tax/ Inheritance Tax Was Reset in Early 1990s

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lukeskywalker

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Hello. I have a somewhat complex query re inheritance tax. I am quite familiar with how gift tax & inheritance tax works at the moment in terms of annual small gifts exemptions & how it is a lifetime cumulative sum dependent on the class of disponer etc etc.

My father has passed away, and I am aware that what I will get through the probate will put me over the current lifetime cumulative 2021 parents to child threshold so I will now have an inheritance tax liability

The calculation of what I have already received prior to his death is complicated by the fact that he paid in money into an account in my name over a long period of time from the 1980s up to 1997 when I used the accumulated sum of money (about €30K euro in 1997) as a deposit for a house. I have no actual records of this as the banks only go back 7 years.

I am aware of the small gift annual exemption being €635 euro from 1991-1997 so I understand that period of time and how to handle it.

However, I can find nothing about pre-1991, and my current understanding is that gift / inheritance tax was "re-set" in ?1991 such that gifts / inheritances prior to 1991 are disregarded in the 2021 calculations of lifetime gifts / inheritances. Is this correct? Thanks for any help with this.
 
You pay Capital Acquisitions Tax (CAT) on the total of all taxable gifts and inheritances received since 5 December 1991.

Just an observation, but this date really needs to be reset to a new date closer to today but obviously that would exclude some gifts from the tax net.

for reference, in the U.K. gifts made more than 7 years ago are automatically excluded from inheritance tax.

30 years to keep records seems a tad ridiculous and has to be a factor in why probate can drag on in Ireland.

the effect of this is that gifts and inheritances are treated effectively the same in Ireland whereas in the U.K. gifting assets to the next generation early is effectively rewarded.
 
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Marc thank you for this. So is it the case that gifts prior to 5th December 1991 from parents to kids are disregarded in terms of calculating lifetime cumulative gifts to date ? In other words, was the lifetime calculator "reset to zero" in December 1991?
 
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