How is the tax calculated?
Tax Applied to Market Value of Property
It is the market value of the property that is taken into account for the calculation even though the property may have been gifted i.e. no valuable consideration passing. There are two notable reliefs which can result in the taxable value being less than the market value and they are:
(a) Agricultural Relief
The first €3,000 of the total value of all gifts (not inheritances) received from any one individual in any calendar year is exempt.
Gifts and inheritances between spouses are exempt.
Where a child had taken non-exempt gifts or inheritances from either or both parents within the period of 5 years immediately prior to the death of the child and that inheritance is taken by a parent/s on the child's death - it is exempt.
A gift or inheritance of a dwelling house occupied by the recipient as his/her only or main residence for a period of 3 years immediately preceding the date of the gift or inheritance is exempt from Capital Acquisitions
Tax. However, on or after 1st February 2008 a parent can no longer gift tax free the family home they share with their child unless the parent has moved out of the home at least 3 years prior to the gift, while the child remained in occupation of it as his/her principal private residence. This provision does not apply to inheritances.
A gift or inheritance taken exclusively for the purpose of discharging the medical expenses of a permanently incapacitated individual is exempt from capital acquisitions tax.
All transfers of property from one former spouse to another are exempt where those spouses have divorced and the transfer is made pursuant to certain Court orders.
Certain normal and reasonable payments gifted by an individual to members of his family for support, maintenance or education, or to a dependent relative for support or maintenance are exempt.
Works of art, scientific collections, libraries, houses or gardens etc. are exempt from capital acquisitions tax provided they are of national, scientific, historic or artistic interest, and are kept permanently in the state and are open to public viewing.