Capital Acquisitions Tax - better known as inheritance or gift tax - is charged at 33% on anything passed above the tax-free threshold. A short conversation now can change what your family actually receives later.
Capital Acquisitions Tax (CAT) is the tax that Revenue charges on money or property that is gifted to, or inherited by, someone in Ireland.
How much tax - if any - is owed depends on the relationship between the beneficiary and the disponer (the person making the gift or leaving the inheritance). There are three threshold groups, each with its own tax-free amount. Anything received above that threshold is taxed at 33%.
If it's anticipated that a beneficiary will receive a gift or inheritance exceeding their tax-free threshold, we can guide you through the Revenue-approved insurance plans designed to pay those taxes on your behalf - so the money you leave isn't quietly handed back.
Start a conversationThe threshold that applies depends entirely on the relationship between the recipient and the disponer. Below each amount, the inheritance or gift is tax-free - above it, the balance is taxed at 33%.
A child (including adopted child, stepchild and certain foster children), or a minor child of a deceased child of the disponer. Parents also fall within this threshold where they take an absolute inheritance from a child - not a gift.
A brother or sister, a nephew or a niece, or a lineal ancestor or lineal descendant of the disponer - a grandchild, for example.
Applies in all other cases - friends, cousins, partners outside of marriage or civil partnership, and any beneficiary not covered by Group A or B.
Thresholds are lifetime - prior gifts and inheritances within the same group eat into the amount that's still available, which is why planning ahead matters.
That's the current (2026) CAT rate. On a six-figure inheritance, the bill can run into the tens - or hundreds - of thousands. The good news: with a bit of planning, most of it is foreseeable, and a lot of it can be funded in advance.
Two specific Revenue-approved policies - one designed for gifts, one for inheritances - let you put money aside now to settle the eventual tax bill tax-efficiently, without eating into what your beneficiaries receive.
We'll talk you through whether either is a sensible fit for your family's situation.
Eolas Money are not legal or tax advisors - your solicitor and accountant remain the right people for the legal drafting and formal tax returns. We sit alongside them with the financial planning piece. If the question is about the years before an inheritance rather than after - the Fair Deal scheme, an Enduring Power of Attorney, nursing-home costs - see planning for older age.
Anything not covered here? The 30-minute discovery call is the right place to ask - bring the awkward ones too.
A child can inherit €400,000 from a parent tax-free; a brother, sister, niece, nephew or grandchild can receive €40,000; anyone else can receive €20,000. Those are the Group A, B and C thresholds in force since 2 October 2024 and still current in 2026. They are lifetime limits: every gift or inheritance you have taken in the same group since 5 December 1991 counts against them. Gifts and inheritances between spouses and civil partners are exempt altogether.
33%, charged on everything above your tax-free threshold. A child who inherits €500,000 from a parent in 2026 pays 33% on the €100,000 above the €400,000 Group A threshold, which is €33,000. There is no lower band and no taper: the first euro over the line is taxed at the full rate, which is why planning who receives what, and when, changes the bill.
Yes. Anyone can receive €3,000 a year from any one person under the small gift exemption without it counting towards their lifetime threshold, so two parents can give each child €6,000 a year between them, and a grandparent can add €3,000 more. Anything above that uses up the child's €400,000 Group A threshold, and larger gifts are taxed at 33% once the threshold is gone. Regular use of the small gift exemption over many years is one of the simplest ways to pass on wealth without a tax bill.
A spouse or civil partner pays none: transfers between spouses and civil partners are exempt from Capital Acquisitions Tax entirely. A cohabiting partner who is not married or in a civil partnership is treated as Group C, with a tax-free threshold of only €20,000, and pays 33% on everything above it. For couples who own a home together but are not married, that difference is the single biggest reason to plan: a jointly owned house or a life policy passing to a partner can create a tax bill the survivor cannot easily pay.
A life assurance policy set up under Section 72 of the Capital Acquisitions Tax Consolidation Act 2003 specifically to pay an inheritance tax bill. The proceeds are exempt from inheritance tax themselves as long as they are used to pay the tax due on the estate, so the family is not selling the house or the farm to settle the bill. It suits people whose estate is worth well above their children's thresholds and is mostly property. The premium is a cost, so we compare it against gifting, wills and other reliefs before recommending it.
Figures checked on 5 September 2026 against Citizens Information (Capital Acquisitions Tax). Rules and rates change each Budget; confirm the current figure before acting on it.
A few lines on your situation is plenty - who you'd like to provide for, roughly what's involved, and what's worrying you. Brendan replies personally, usually within one working day.
Message Brendan or pick up the phone - the first conversation is informal, free, and usually answers most of the obvious questions before anything more formal is needed.
