Relief Granted Business relief has the effect of reducing the value of certain qualifying trading business assets by 90 percent for CAT purposes. The effect of this 90 percent reduction is that a significant amount of property could qualify for exemption from CAT. Where tax applies, the rate is effectively reduced from 33 percent to […]
Qualifying Business Assets There are various categories of qualifying (called “relevant”) business property a business (e.g. sole trader) interest in a business (e.g. partnership) unquoted shares giving the beneficiary more than 25 percent of votes in the company unquoted shares giving 10 percent of the share capital for a beneficiary employed certain lands, buildings, machinery […]
Pension Schemes Bona fide payments to an employee or former employee out of funds provided by the employee or certain others by way of retirement benefit, redundancy payment or pension are not deemed inheritances. Benefits taken by widowed or widowers are exempt, or if taken by other dependents, will have the same threshold of the […]
Overview The CAT legislaiton provide that the proceeds of life insurance policies, taken out expressly to pay CAT, are exempt from tax provided certain conditions are satisfied. For the inheritance tax exemption, the main condition is that the inheritance must be taken on or after the death of the insured person and not later than […]
Unilateral Relief Double taxation agreements are very limited in relation to inheritance tax applying to U.S. and UK principally. Unilateral relief may be given only where double taxation relief is not available. Unilateral relief may be granted where an inheritance or gift is subject to Irish CAT and is also subject to a foreign capital […]
Discretionary Trust Where assets are subject to a discretionary trust as defined, there is a once-off 6 percent charge and an annual charge after that. The tax is applied on the date when the assets become subject to a discretionary trust (in the sense defined) at the date of death of the person creating the […]
Liable Person A person who takes a gift or a benefit by way of inheritance is potentially liable to pay capital acquisitions tax. The primary obligations rest on the donee, the transferee or successor. Any person who is liable to pay capital acquisitions tax, whether inheritance tax, gift tax or discretionary trust levies must deliver […]
Powers of Revenue The Revenue has extensive powers in the CAT Act supplementing their general Tax Consolidation Act powers. They have powers to seek additional evidence, make enquiries and inspect documents. They can require an accountable person to deliver and verify a statement of particulars relating to assets and such evidence as they believe require […]
Overview The Revenue has the usual methods and means of enforcement available for the collection of inheritance tax. See the sections on tax administration generally. Interest applies on unpaid taxes. The daily rare is 0.0219% . This is in addition to penalties and surcharges. Interest on overpaid tax applies within four years of the due […]
Freedom to Leave Assets by Will To a large extent, a person is free to leave his assets to whomsoever he wants. This freedom is subject to the legal right share of a spouse or civil partner and the right for children to apply to the court, where the deceased has failed in his moral […]
Overview The law prescribes the formalities by which assets are transferred to successors upon a person’s death. The entitlement to assets is determined by the terms of the Will, subject to the rights of spouses and children. If there is no Will or no fully operative Will, the intestacy rules apply. See our separate chapters […]
Overview Countries take different approaches to the extent to which a person is free to dispose of his assets on death. In France and some other continental countries, high mandatory shares of the deceased’s assets must go to his children. It is difficult to defeat this right, even by lifetime gift. It is only in […]
Rights of Children Children do not have an automatic right to benefit from the estate of their parents. A parent ay choose not to give particular children or indeed any of his children, any benefit at all. Even where the spouse has not survived, it children have no entitlement to any share. The Courts will […]
General The personal representative, whether an executor or administrator, is obliged to collect in the deceased’s assets and distribute them in accordance with the terms of the will or the rules on intestacy, as the case may be. Legislation confers a range of powers and duties on the personal representatives. They must finalise income tax […]
Apply at Death There are well-established principles of interpretation of wills. It takes effect at the date of death and applies to the assets and liabilities of the deceased at the date of his death. A will is interpreted in light of the circumstances which prevail at the date of death. It does not matter […]
Duties of Personal Representatives The position of personal representatives is potentially onerous. Personal representatives have significant legal duties. They have many of the same duties as trustees. The succession legislation deems the personal representative to be trustee in respect of assets vested in him. He must exercise his powers with due diligence, care and attention. […]
Intestacy When a person dies without a will, he or she is said to die intestate. An “intestate” means a person who leaves no will or leaves a will but leaves undisposed of some beneficial interest in his estate, and “intestate” shall be construed accordingly. The Succession Act sets out who inherits the assets of […]
Contentious Matters In the vast majority of cases, the taking out of a grant of probate or letters of administration and the administration of the estate will not be contentious. There will not be different parties who are claiming contrary positions. However, disputes may arise in relation to the validity of the wills. They may […]
High Court Procedures An application may be made to the court by way of a special summons procedure on a range of issues relevant to the administration of estates. These include the determination of rights and interests of parties and a direction to the executor or administrator to do or refrain from doing a particular […]