Inheritance tax if living overseas

[partnership]

We are planning to retire to Australia in 2 years time age 60 and 62. As it will be a temporary visa pending permanent we are reluctant to sell our house and would rent it out. We have one son who will inherit and he lives in Australia. If we died would he have to pay tax if we still had the house in Ireland?

 

[jpd]

Yes, CAT (Inheritance Tax) would be due as the property is situated in Ireland

Tax may also be due in Australia

Some of the tax due may be offset by tax paid in the other jurisdiction

 

[partnership]

Yes, CAT (Inheritance Tax) would be due as the property is situated in Ireland

Tax may also be due in Australia

Some of the tax due may be offset by tax paid in the other jurisdiction

Would he be able to inherit the 335 tax free or does he not get that? No inheritance tax in Australia.

 

[AAAContributor]

Would he be able to inherit the 335 tax free or does he not get that?

He is entitled to the Group A threshold. It does not matter that he is a non-resident beneficiary.

All beneficiaries (whether resident or non resident) are obliged to file a CAT return (and pay any CAT if any) where 80% of their relevant lifetime thresholds (Group A in this instance) have been exceeded. I presume your son already has a PPSN. This will be needed for the CAT filing.

If your son (a non-Irish resident) is going to be your personal representative / executor, then an Irish resident (solicitor) will have to be appointed as an 'agent' of a non-resident beneficiary (if bequest exceeds €20k) prior to seeking a Grant of Probate.

 

[Towger]

You are right to be reluctant to sell your house. They are reluctant to give permanent residency to older people, unless you are arriving with the means to support yourself the rest of your days.

 

[partnership]

You are right to be reluctant to sell your house. They are reluctant to give permanent residency to older people, unless you are arriving with the means to support yourself the rest of your days.

My only worry is the length of time it takes to process the permanent visa means we could be 70 or older and might fail a medical. It would be hard to come back and buy then. Glad to hear he is still entitled to the threshold.

 

[Horatio]

I note your reluctance to sell. Do note that if you sell you are exempt from CGT if the house is you Primary Principle Residence. This exemption is on a reducing pro rated scale over 10 year if I remember correctly.

So you could potentially sell CGT free & take out the full value of your home & bring it with you to Australia which may support your application for permenant residence. It would show financial indpendence to an extent.

I'd be very slow to try to rent & manage a rental property in Ireland from Australia.
Best of luck whatever path you take. Exciting times.