Favourite Nephew

Sally Floyd

About 10 years ago, my aunt (who has no children) gave me a site to build a house. We got it valued on the 'cheap' side (about 50k) to avoid gift tax. She now wants to give me another site but needs to keep the valuation down to avoid the gift tax again. What is the threshold to avoid tax? I think I am what the revenue call a 'favourite nephew'!

farrentax

Hi,

The thresholds for gift tax have significantly decreased in the last few years due to deflation. A nephew comes under group threshold B which is now €33,208. When you received your previous gift this threshold was in excess of €50K and that is why there was no tax liability.

The favourite nephew relief that you refer to only applies to the gift of business assets and you must have worked in the business on a full-time basis for the last 5 years. If this is the case your threshold is increased to €332,084. This would only be applicable in your case if this was farm land and you had worked on your aunts farm.

Also, the threshold applies to all gifts you have received from anybody in group B since 1991, therefore the value of the site you receive now will be liable to CAT with a small deduction for the gifts exemption.

Mr. Incognito

Property thread.

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