Capital Acquisitions Tax (CAT)

Capital Acquisitions Tax (CAT) applies to gifts and inheritances at a rate of 33%. However, certain exemptions and reliefs can significantly reduce or eliminate your tax liability.

Try out our CAT calculator or keep reading to learn more about CAT.

Exemptions: Gifts and Inheritances Free from CAT

Some gifts and inheritances are entirely exempt from CAT, meaning no tax is due. These exemptions include:

• Spousal/Civil Partner Exemption: Gifts and inheritances received from your spouse or civil partner are completely exempt.
• Small Gift Exemption: You can receive up to €3,000 per calendar year from any individual without incurring CAT. This is a separate exemption and does not apply to inheritances.
• Family-Related Exemptions: Gifts for the support, maintenance, or education of a child or dependent relative of yourself or your spouse/civil partner. Inheritances received from your child if, within the previous five years, they received a non-exempt gift or inheritance from either parent.
• Retirement, Work, and Health-Related Exemptions: Retirement benefits, pensions, and redundancy payments from your employer (with potential limitations for relatives or controlled private companies). Benefits specifically for medical expenses if you are permanently incapacitated.
• Other Exemptions: Payments for damages or compensation. Benefits for charitable purposes. Winnings from lotteries, sweepstakes, games, or bets. Benefits to reduce debt during bankruptcy or a debt resolution procedure. Certain heritage property.

Tax Reliefs: Reducing Your CAT Liability

Certain gifts and inheritances qualify for tax relief, which lowers the amount of CAT you owe. Examples include:

• Gifts or inheritances from a foster parent.
• Gifts or inheritances from an aunt or uncle whose business you worked in.
• Gifts or inheritances from a relative of your deceased spouse or civil partner.
• Gifts or inheritances of business or agricultural property.

Tax-Free Thresholds: Receiving a Certain Amount Tax-Free

All gifts and inheritances are subject to tax-free thresholds, which depend on your relationship with the giver:

• Group A: This group primarily applies to gifts or inheritances from a parent to a child (including adopted, step, and foster children).  
• Also can apply to minor grand children in certain circumstances.  
• As of Budget 2025, the Group A threshold is €400,000.  
• Prior to the changes from budget 2025, the group A threshold was 335,000 euro.
• Group B: This group covers gifts or inheritances from closer blood relatives, such as grandparents, siblings, aunts, and uncles. As of Budget 2025, the Group B threshold is €40,000.  
• Prior to the changes from budget 2025, the group B threshold was 32,500 euro.  
• Group C: This group applies to any relationship not included in Group A or B, such as more distant relatives or friends. As of Budget 2025, the Group C threshold is €20,000.  
• Prior to the changes from budget 2025, the group C threshold was 16,250 euro.

Important Notes:

• Exempt gifts and inheritances do not count towards your tax-free threshold.
• You do not need to file a CAT return for gifts that fall under the small gift exemption.