Inheritance tax

femur61

My father passed away in November 2012. I am only paying inheritance tax now, Revenue sent me forms in August. The inheritance is divided equally with me and my brothers, some who live in the UK. Our solicitor was obliged by law to pay their inheritance tax. He paid at the old rate of 30% on €250k which was the threshold for 2012 and it changed in the budget in December that year .

My question is to benefit the 2012 threshold (the time of my fathers passing), should it have been paid last year in 2013 and now we are paying in 2014 should we be paying the 2013 rates?

Unfortunately, my solicitor is away.

Peregrinus

The rate is the rate which applied when the inheritance was "taken", which is not the date it was paid but the date you became entitled to it. This is mostly the date of death.

Same goes for your inheritance tax threshhold - the applicable threshhold is the one whic applied when the inheritance was taken.

So, in the absence of further facts which you haven't told us, you should get the larger threshold and the lower rate. The date the payment is actually made is irrelevant.

femur61

Peregrinus wrote: »

The rate is the rate which applied when the inheritance was "taken", which is not the date it was paid but the date you became entitled to it. This is mostly the date of death.

Same goes for your inheritance tax threshhold - the applicable threshhold is the one whic applied when the inheritance was taken.

So, in the absence of further facts which you haven't told us, you should get the larger threshold and the lower rate. The date the payment is actually made is irrelevant.

Thanks, not too sure what you mean "in the absence of further facts."

Again, much appreciated.

Peregrinus

The relevant date is the date when you become absolutely entitled to the property. Normally that's the date of death, but it could be later if, say, property is left to someone when he turns 25, or when he marries, but to go to someone else if these things never happen. Or if property is left to the survivor of A and B - that kind of thing. Or property is left on trust to be used for a young person's education and maintenance, the balance (if any) to be handed over at 21.

You don't say anything about the terms of your inheritance of this property, so I assume it's a straightforward immediate bequest taking effect on death - that's so in probably 99% of cases. If there is something curly about your inheritance, you haven't mentioned it. That'd be the "further fact".

raspberrypi67

femur61 wrote: »

My father passed away in November 2012. I am only paying inheritance tax now, Revenue sent me forms in August. The inheritance is divided equally with me and my brothers, some who live in the UK. Our solicitor was obliged by law to pay their inheritance tax. He paid at the old rate of 30% on €250k which was the threshold for 2012 and it changed in the budget in December that year .

My question is to benefit the 2012 threshold (the time of my fathers passing), should it have been paid last year in 2013 and now we are paying in 2014 should we be paying the 2013 rates?

Unfortunately, my solicitor is away.

Hi There,

Can I ask if the tax was applied to the amount each person got after splitting the value. IE in the case where a house may be worth 600K and divided between say 6 brothers, = 100K , is the CGT then applied, though in this case is the threshold 250K?

coylemj

raspberrypi67 wrote: »

Hi There,

Can I ask if the tax was applied to the amount each person got after splitting the value. IE in the case where a house may be worth 600K and divided between say 6 brothers, = 100K , is the CGT then applied, though in this case is the threshold 250K?

It's taxed in the hands of the individual, it doesn't matter what the total value of the asset was. The threshold for a brother is 30,150 since Dec 2012 so in your example those six brothers would each be liable to CAT (capital acquisition tax) on a taxable inheritance of 69,850 (100,000-30,150). All of the thresholds are listed here.....

http://www.revenue.ie/en/tax/cat/thresholds.html