How Much Is Inheritance Tax in Ireland?

When a loved one passes away, their assets may pass to family members, friends, or other beneficiaries. Alongside the emotional side of inheritance, a practical question arises very quickly:

“How much inheritance tax will I have to pay in Ireland?”

In Ireland, inheritance tax is called Capital Acquisitions Tax (CAT). It applies to both inheritances and gifts, though the rules differ depending on the relationship to the person making the gift or bequest.

The rules can be complex - thresholds, lifetime limits, reliefs, and exemptions all play a part. That’s why many people turn to Irish Tax Hub’s CAT Review Service to calculate their liability, ensure they are compliant with Revenue, and identify ways to reduce the tax bill.

1. The Rate of Inheritance Tax in Ireland

The current rate of Capital Acquisitions Tax (CAT) is 33% (2025). This is a flat rate and applies to the taxable value of the inheritance above the relevant tax-free threshold.

👉 Example:

• You inherit €500,000 from your parent.
• The Group A tax-free threshold (parent to child) is €400,000.
• Taxable inheritance = €500,000 – €400,000 = €100,000.
• CAT payable = 33% of €100,000 = €33,000.

It’s important to note that this is a lifetime calculation. If you previously received a gift of €50,000 from your parent, that would also count towards your €400,000 threshold.

Irish Tax Hub’s CAT Review Service tracks your cumulative position to ensure you don’t unexpectedly cross the threshold without realising it.

2. CAT Threshold Groups

Inheritance tax thresholds are grouped into three categories, depending on the relationship between the person leaving the inheritance (the disponer) and the person receiving it (the beneficiary).

Group A – €400,000 (2025)

• Parent to child (including stepchildren, adopted children, and certain foster children).
• This is the most generous threshold, reflecting the close family relationship.

Group B – €40,000 (2025)

• Inheritances from siblings, nieces, nephews, grandparents, grandchildren.

Group C – €20,000 (2025)

• Inheritances from anyone else, such as cousins, friends, or non-family members.

👉 Example:
If you inherit €100,000 from your uncle:

• Threshold = €40,000 (Group B).
• Taxable inheritance = €100,000 – €40,000 = €60,000.
• CAT = 33% of €40,000 = €13,200

Why Irish Tax Hub helps: We often find clients underestimate how small the thresholds are outside of direct parent-to-child transfers. A relatively modest inheritance from an uncle or aunt can trigger a surprisingly large tax bill.

Use our CAT calculator to estimate your tax liability or check out our other tools here.

3. What Counts as Taxable for CAT Purposes?

CAT applies to inheritances in the following cases:

• If the disponer (person leaving the inheritance) was resident or ordinarily resident in Ireland, then worldwide assets may be within scope.
• If the beneficiary is resident or ordinarily resident in Ireland, then worldwide inheritances are also taxable.
• Irish assets (such as property in Ireland, Irish shares, or Irish bank accounts) are always taxable, regardless of residence or domicile.

👉 This is a common trap. Many clients assume that if they inherit a property or money abroad, Irish tax doesn’t apply. But if you are Irish resident or ordinarily resident, it usually does.

At Irish Tax Hub, we review your residence and domicile position carefully. Sometimes, residency rules can exempt an overseas inheritance from Irish tax - but this needs to be analysed in detail.

4. Lifetime Limits – Not Annual

A key feature of Irish inheritance tax is that thresholds are lifetime amounts, not yearly allowances.

This means:

• Every gift or inheritance from people in the same group is added together over your lifetime.
• Once you exceed the threshold, any further benefits are taxed at 33%.

👉 Example:

• In 2015, you received a gift of €200,000 from your parents.
• In 2025, you inherit €300,000 from them.
• Your lifetime total from parents = €500,000.
• Group A threshold = €400,000.
• Excess = €100,000 → CAT = 33% = €33,000.

Irish Tax Hub’s CAT Review Service maintains a running total of your prior gifts and inheritances. Many clients are caught out because they don’t realise earlier gifts “use up” part of their tax-free threshold.

5. Reliefs and Exemptions

The legislation does provide reliefs and exemptions that can dramatically reduce the tax burden if claimed correctly:

• Spouse/Civil Partner Exemption – transfers between spouses or civil partners are fully exempt.
• Dwelling House Exemption – if you inherit a home you lived in with the disponer, it may be exempt if strict conditions are met.
• Business Relief – reduces the taxable value of qualifying business assets by 90%.
• Agricultural Relief – reduces the taxable value of qualifying agricultural property by 90%.
• Small Gift Exemption – you can receive up to €3,000 per year, per disponer, tax-free.

👉 These reliefs are highly technical. Revenue often challenge claims if the paperwork is not watertight. Irish Tax Hub helps clients prepare the supporting documentation and ensures claims are submitted correctly.

6. Filing and Deadlines

A CAT return (Form IT38) must be filed if:

• The inheritance exceeds 80% of the relevant threshold, or
• Any CAT is payable.

Deadlines:

• Inheritances between 1 January and 31 August → file and pay by 31 October that year.
• Inheritances between 1 September and 31 December → file and pay by 31 October of the following year.

Late filing leads to interest and penalties. Our CAT Review Service takes care of the entire process - from calculating liability, to preparing returns, to dealing with Revenue on your behalf.

7. Planning Ahead to Reduce Inheritance Tax

Inheritance tax planning is not just about compliance. It’s about ensuring your family doesn’t face a large and unexpected tax bill at an already difficult time.

Some strategies include:

• Lifetime gifting – making use of the €3,000 annual small gift exemption to gradually transfer wealth tax-free.
• Spreading inheritances – structuring gifts to make use of multiple thresholds across family members.
• Business and agricultural planning – ensuring assets qualify for reliefs in advance of transfer.
• Property planning – structuring ownership so that the dwelling house exemption may be available.

Final Thoughts

So, how much is inheritance tax in Ireland?

• The rate is 33%.
• The amount depends on your relationship, lifetime threshold usage, and whether reliefs apply.
• For many, the numbers add up quickly - and without professional help, it’s easy to overpay or miss opportunities to reduce the bill.

At Irish Tax Hub, our CAT Review Service provides:

• A clear calculation of your liability.
• Confirmation of what reliefs and exemptions apply.
• Assistance with filing the CAT return on time.
• Inheritance planning advice to minimise future tax.

Don’t leave it to chance. If you’ve received or expect to receive an inheritance, contact Irish Tax Hub today to book your CAT Review and ensure your family’s wealth is protected.