When is Inheritance Tax Payable

If you receive an inheritance following a death, either under a Will or intestacy, it may be liable to inheritance tax (also known as Capital Acquisition Tax (CAT)).

Inheritance Tax is a self assessment tax. The person who receives the inheritance is the person responsible to pay the tax, if tax is due on the inheritance.  

The current rate of inheritance tax, for gifts or inheritance received on or after the 6th of December, 2012 is 33%.

If you have received a gift or inheritance which is liable to inheritance tax you must file an IT38 Return with the Revenue Commissioners and pay any tax due. 

If there is no tax due but the gift or inheritance that you receive exceeds 80% of your threshold amount you must still file an IT38 return.

You should also note that any prior gifts and/or inheritance received by you in the same threshold after the 2nd of December 1991 must also be taken into account.  

Recently the Pay and File date for inheritance tax changed. It has now been amended to the 31st October 2012. It is important that your tax is paid before this date otherwise interest will be charged on the tax due to the Revenue Commissioners. 

Examples:

• Tom's father died on the 21st February 2012: Tom received a farm under his father's Will.  Tom must file his IT38 return and pay all tax due before the 31st October 2012

• Mary's aunt died on the 6^th November 2012: Mary received a house and money under her late aunt's Will. Mary must file her IT 38 return and pay all tax due before the 31st October 2013

Rates of Inheritance Tax

The full list of rates of tax payable by a beneficiary are below. 

Gift/Inheritance	Rate of Tax
Up to threshold amount	Nil
Amount received above threshold amount	33% on gifts/inheritance received on/after 06/12/2012
	30% on gifts/inheritance received between 07/12/2011 to 05/12/2012
	25% on gifts/inheritance received between 08/04/2009 to 06/12/2011
	22% on gifts/inheritance received between 20/11/2008 to 07/04/2009
	20% on gifts/inheritance received prior to 19/11/08

 

The examples above are for illustration purposes only and are simplified for these purposes. Under no circumstances should these figures be relied upon.

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