Gifting Sibling A Site - Tax Implications

[ODonovanRossa20]

Hi All,

Apologies if this has been asked and answered before, but here are my circumstances.

I inherited the family farm last year and invoked consanguinity relief when doing so. There is an unfinished dwelling/house on the land (part of the same folio) which I would like to gift to my brother. Can anyone offer any insight into the tax implictions of this? I'd appreciate any advice.

 

[homer911]

Get independent valuations, choose a valuation in the middle of the range. A gift to your brother would be Group B gift with an aggregate threshold of €32,500 ([broken link removed]). Your brother can avail of the €3,000 annual exemption on top of the €32,500.
I'm not clear on whether the legal costs associated with the transfer can be deducted from the valuation if paid by your brother

 

[RedOnion]

The question is very specific, and I would suggest that you seek professional tax advice on the matter, from someone familiar with the topic. It's more complicated than a standard gifting of a site because of the relief you used. There are some specific provisions to navigate around claw back provisions, specifically when it comes to 'development land'. I don't know if there are any exemptions for gifting a site to a family member, usually any such relief would only be available to a child, but it's a very specific area. The claw back generally talks about reinvestment of the proceeds you receive, but with a gift there are no proceeds.

If one were to get over technical, it could be argued that the site with the unfinished house is not agricultural land and might not have qualified for relief in the first place. How it was all valued initially would have a bearing on the implications now.

 

[dereko1969]

The question is very specific, and I would suggest that you seek professional tax advice on the matter, from someone familiar with the topic. It's more complicated than a standard gifting of a site because of the relief you used. There are some specific provisions to navigate around claw back provisions, specifically when it comes to 'development land'. I don't know if there are any exemptions for gifting a site to a family member, usually any such relief would only be available to a child, but it's a very specific area. The claw back generally talks about reinvestment of the proceeds you receive, but with a gift there are no proceeds.

If one were to get over technical, it could be argued that the site with the unfinished house is not agricultural land and might not have qualified for relief in the first place. How it was all valued initially would have a bearing on the implications now.

This really should have been sorted out before the initial inheritance, there seems to be a blind spot in this country in relation to property and what happens post-death, particularly in farmland inheritance cases.