Capital Acquisitions Tax (CAT)
Capital acquisitions tax is charged to the recipient of gifts or inheritances, at the rate of 25% above a tax-free threshold. Gifts and inheritances are gratuitous benefits; the difference is that an inheritance is taken on death and a gift is taken other than on death.
The person providing the property is called the donor or disponer, or testator or deceased in the case of inheritance; the person receiving the property is called the beneficiary, donee or disponee, or the successor in the case of inheritance.
A gift is taken when a donee becomes beneficially entitled in possession to some property without paying full consideration for it. Tax is payable within four months of the date of the gift; an interest charge applies to late payments.
Tax is generally charged on the property’s taxable value, which is computed as:
Market value
less liabilities costs and expenses payable out of the gift or inheritance
= incumbrance free value
less consideration paid by acquirer in money or money’s worth
= taxable value
Read more about this topic: Taxation In The Republic Of Ireland
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