Tax Implications - Son's Estate to Parents

B

Blue Hero

Registered User
Messages
7
Hello folks,
Unfortunately my brother passed away tragically last year. As he was unmarried, the likes of his savings, life insurance pay out went to our parents as they were listed the beneficiary of his estate.
Just wondering are there any tax implications for my parents in this?
Also if they gifted money to other siblings just wondering does tax have to be paid or is there a threshold.
Thanks for help
 
Blue Hero said:
Unfortunately my brother passed away tragically last year.
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Sorry to hear that, condolences.
Blue Hero said:
As he was unmarried, the likes of his savings, life insurance pay out went to our parents as they were listed the beneficiary of his estate.
Just wondering are there any tax implications for my parents in this?
Click to expand...
What is the value of the estate? Capital Acquisitions Tax group A tax exemption threshold of €335K (per parent?) should apply on an inheritance from child to parent(s) as far as I know so unless he left more than that (or maybe more than €670K?) or this inheritance plus any previous group A inheritances (e.g. from your parents' parents) exceeds the threshold there shouldn't be any tax due.

CAT groups and group thresholds

This page explains thresholds, rates and aggregation rules for calculating Capital Acquisitions Tax
www.revenue.ie
Even if the inheritance is tax exempt they may have to file a return if the amount inherited is 80%+ of the threshold (including any previous inheritances in the same group as far as know).

Capital Acquisitions Tax (CAT) thresholds, rates and aggregation rules

This page outlines CAT thresholds, rates, and aggregation rules
www.revenue.ie
Blue Hero said:
Also if they gifted money to other siblings just wondering does tax have to be paid or is there a threshold.
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This is separate to the inheritance issues above. They can each gift €3K p.a. to others tax free without eating into the relevant lifetime CAT exemption thresholds. (This can extend to their childrens' spouses/partners, grandchildren, or even unrelated individuals).

Small Gift Exemption

Exemption from CAT on small gifts
www.revenue.ie
If they gift more than that in one go then it reduces the lifetime group A allowance for the recipient child and the recipient may have filing responsibilities and/or tax liabilities depending on the amounts involved.

If I've made any mistakes above I'm sure that others will quickly correct me.
 
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