Capital Acquisitions Tax Planning

Reducing the tax on gifts and inheritances

Capital Acquisitions Tax planning is about passing wealth to the next generation without an avoidable tax bill eroding what you have built. CAT is the Irish tax on gifts and inheritances, charged at 33% on the value a person receives above their tax-free threshold. Used early, thresholds, exemptions and reliefs can keep far more of that value within the family. Our guide to inheritance tax in Ireland sets out how the charge works in detail.

We act for business owners, farmers and families across the Midlands who want to plan transfers properly rather than leave the outcome to chance. The earlier a plan starts, the more options remain open.

How CAT is charged

Three figures determine a CAT bill: the value of what is received, the recipient’s relationship to the person giving it, and the threshold that relationship attracts. The closer the relationship, the higher the tax-free threshold. Gifts and inheritances received within the same threshold group are added together over a lifetime, so a large gift today reduces what can be received tax-free later.

The 33% rate is well established, but the thresholds and the annual small-gift exemption are set by Revenue and change from time to time. We confirm the current figures with you before any decision is made, and we keep your running total under review as circumstances change.

Reliefs that make the real difference

For trading and farming families, the headline reliefs often matter more than the thresholds:

• Agricultural relief can reduce the taxable value of qualifying agricultural property by up to 90%, provided the recipient meets the farmer test and the conditions around use and retention.
• Business relief offers a comparable reduction for qualifying trading businesses passed on by gift or inheritance.
• Dwelling house exemption can apply where someone inherits the home they have been living in, subject to strict conditions.

These reliefs are valuable but unforgiving. A misstep in how an asset is held, or what the recipient does afterwards, can put the relief at risk. We check the conditions in advance and structure the transfer so the relief holds up.

Planning ahead, not reacting

The best CAT outcomes come from a plan that runs over years, not a single transaction. Using the annual gift exemption consistently, timing transfers sensibly, and aligning gifts with a wider succession strategy all reduce the eventual bill. Where a business or farm is involved, CAT planning sits alongside succession and estate planning and the capital gains tax that the same transfer can trigger, so every tax angle is considered together.

For families with more complex affairs, our work for high net worth individuals brings the same joined-up approach across personal and business interests. Where a transfer is part of a broader review, our tax planning service ties everything together.

Talk to us before you transfer

Once a gift is made or an inheritance falls due, your options narrow. Speaking to us early gives you the room to plan properly and claim every relief you are entitled to. Visit our Mullingar office or get in touch to book a free consultation about your CAT position.