Inheritance Tax Planning

Effective inheritance tax planning ensures that you can pass on your assets to your loved ones in the most tax-efficient way. Learn about options to minimise tax liabilities and maximize the inheritance for your beneficiaries.

Understanding Inheritance and Gift Tax in Ireland

Are you planning to pass on wealth to your family? If so, it's important to understand that gifts and inheritances in Ireland may be subject to Capital Acquisitions Tax (CAT). The tax-free amount depends on your relationship to the recipient and is subject to thresholds set by the Revenue.

  • Group A: Children and certain other descendants have a threshold of €335,000.
  • Group B: Siblings, nieces, nephews, and other descendants have a threshold of €32,500.
  • Group C: All other relationships have a threshold of €16,250.

If a gift or inheritance exceeds these thresholds, CAT is charged at a rate of 33% on the excess amount. Proper planning can help minimise this tax burden.

Inheritance Tax Planning

Utilising Section 73 Relief for Gift Tax

Section 73 of the Capital Acquisitions Taxes Consolidation Act 2003 allows you to set up a life assurance savings policy to cover future gift tax liabilities without creating additional tax liability for the recipient. This is a strategic way to reduce the overall tax burden on your estate.

  • The policy must be set up explicitly for paying gift tax and should last for at least 8 years.
  • All premiums must be paid regularly without a break of more than one year to qualify for relief.
  • The proceeds must be used to pay the gift tax within one year of withdrawal from the policy.

By utilising Section 73, you can ensure that the inheritance or gift is passed on efficiently without incurring unnecessary taxes.

Section 73 Relief

Consider consulting a financial advisor to explore how you can leverage Section 73 relief to minimise tax liabilities on future gifts and inheritances.

Read More on the Revenue Website

For more information on Section 73 Relief and related regulations, visit the Revenue website.

Plan Your Inheritance Tax Strategy Effectively

Work with a financial advisor to create a tailored inheritance tax strategy that aligns with your goals. Proper planning ensures that your loved ones receive their inheritance with minimal tax burden, preserving your legacy.

Preserve Your Legacy with Expert Tax Planning

Contact your Credit Union for personalised advice on reducing inheritance tax and protecting your family’s future.