Giving up an inheritance

J

JPF

Guest
Hi All

Myself and my brothers are due to receive an inheritance of a share in a property from our aunt. However my brother is the only one going to take ownership of the property. My brother is planning on paying us off, the rest of us are fine about this and want him to get it. We would like to gift our brother our share of the property. Will that mean that we will have to pay CAT on our portion (and using up our group B threshold) then he would have to pay CAT on the gift from us? Is there not a provision in the tax law that you can pass up on an inheritance or indicate who you would like to recieve it in your place? IE can we say we dont want to take inheritance and pass it to our brother.
 
If your brother is paying you for your share then how is transfer of your share to him a gift for CAT purposes?
 
The plan was for him to pay us off but we'd prefer to give him our share instead.
So basically i was my brother to get my share instead of me.
 
From what i can see upon inheritance each brother will be liable to pay Inheritance on anything over €52,121 @20%.

If you then gift your portion to one brother he will then be liable to gift tax on anything gifted over €52,121. Both transactions fall under group B

For example if each brother (presume 3 brothers) gets €100,000 on inheritance the CAT liability for each brother will be 100,000 - 52,121 = 47879 @20%.
If two of the brothers then gift their portion to the remaining brother his CAT liability will be €200,000 @ 20% there is no exempt portion as the threshold was all used in the first transaction.

It has been a while since i have dealt with this so if i have missed something i am sure someone will let me know
 
I thought that in a situation like this you could agree that the terms of the will be changed so that the property would go to the brother - he will have to pay tax on his benefit and the op will not use up any of his threshold?
 
You can "disclaim" your inheritance either under a will or an intestacy. When you disclaim you are deemed never to have taken your inheritance, and are not liable to inheritance tax.
If your brother pays you for disclaiming your share (consideration), then the amount he pays you is deemed to come from your aunt as an inheritance, and you may be liable to inheritance tax on that, depending on the usual rules.
Be careful when drawing up a disclaimer, there are rules out there about who gets what and where the disclaimed inheritance goes, so it might not always work out the way you want.
But you CAN do it, just make sure you get good legal advice to ensure you achieve the result you want.
 
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