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Sold inherited house - Question regarding taxes

  • 27-08-2015 7:56pm
    #1
    PM_
    Registered Users, Registered Users 2 Posts: 98 ✭✭


    I need a bit of help understanding something.
    If I inherited a house 3 years ago from a parent and only sold it now for 200k, what tax would I pay on it? I'm getting confused with Capital Gains Tax and Capital Acquisitions Tax. If the house was valued at 90k at the time of death, where does this leave me? Do I pay tax on the difference? What about the thresholds? Also, is there any way around this? If the money is being split between two people would this make any of a difference?

    Many thanks.


Comments

  • #2
    Geuze
    Registered Users, Registered Users 2 Posts: 14,039 ✭✭✭✭Geuze


    CAT is paid at probate, after inheritance.



    CGT is paid on gains made if an asset is disposed, and a gain is made.


  • #3
    Geuze
    Registered Users, Registered Users 2 Posts: 14,039 ✭✭✭✭Geuze


    A child can inherit up to 225k from parents free of CAT.

    If you inherited an asset, or assets, worth 90k, from your parents, then no CAT.

    That assumes no earlier gifts from your parents.

    See here:

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


  • #4
    Johnnio13
    Registered Users, Registered Users 2 Posts: 796 ✭✭✭Johnnio13


    I believe you'll pay 33% on any profit made from valuation on date of death and sale price after. I am not an accountant so you'll need to check with one to limit your exposure


  • #5
    Geuze
    Registered Users, Registered Users 2 Posts: 14,039 ✭✭✭✭Geuze


    If the house has appreciated from 90k to 200k over 3 years (which I find hard to believe), then yes, there may be a CGT liability on the 110k gain.

    This depends on whether you lived in the house or not.


  • #6
    PM_
    Registered Users, Registered Users 2 Posts: 98 ✭✭PM_


    Geuze wrote: »
    If the house has appreciated from 90k to 200k over 3 years (which I find hard to believe), then yes, there may be a CGT liability on the 110k gain.

    This depends on whether you lived in the house or not.

    So could the valuation 3 years ago be wrong? How is this value obtained? Is there any way I could prove it was worth more?

    Also this may be a dumb question, but how would one prove they lived, or didn't live, in the property?


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  • #7
    KlausFlouride
    Registered Users, Registered Users 2 Posts: 198 ✭✭KlausFlouride


    PM_ wrote: »
    Also this may be a dumb question, but how would one prove they lived, or didn't live, in the property?

    It's up to the taxpayer to prove they physically lived there, so utility bills in your name, not paying rent/mortgage somewhere else, payslips from local employer, any paperwork that builds a case that you lived there rather than somewhere else.


  • #8
    KlausFlouride
    Registered Users, Registered Users 2 Posts: 198 ✭✭KlausFlouride


    PM_ wrote: »
    So could the valuation 3 years ago be wrong? How is this value obtained? Is there any way I could prove it was worth more?

    Also this may be a dumb question, but how would one prove they lived, or didn't live, in the property?

    Geuze is referring to Private Residence Relief for CGT, Revenue have good guidance on their website for this, CGT is (relatively) straightforward.


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