Gifting house to children - CGT/CAT

Got2TurnAround

Hi,

I want to transfer ownership of my house to my children (won't go into the reasons here). This would be a gift so no money would change hands. The house is valued at less than €542,544 so if I understand correctly there is no CAT payable by them. My question is around CGT, are they only liable for CGT if/when selling the property? Thanks in advance.

Geuze

Got2TurnAround wrote: »

Hi,

I want to transfer ownership of my house to my children (won't go into the reasons here). This would be a gift so no money would change hands. The house is valued at less than €542,544 so if I understand correctly there is no CAT payable by them. My question is around CGT, are they only liable for CGT if/when selling the property? Thanks in advance.

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

What is the relevance of 542,544?

The CAT lifetime thresholds are as follows:

Group Thresholds Applicable for Capital Acquisitions Tax from 14 October 2015

Group A, Son/Daughter = 280k


Group B, Parent*/Brother/Sister/ Niece/Nephew/Grandchild = €30,150


Relationship other than
Group A or B = €15,075

Gard1

Got2TurnAround wrote: »

Hi,

I want to transfer ownership of my house to my children (won't go into the reasons here). This would be a gift so no money would change hands. The house is valued at less than €542,544 so if I understand correctly there is no CAT payable by them. My question is around CGT, are they only liable for CGT if/when selling the property? Thanks in advance.

As long as the property is your principal private residence and has been the whole time of ownership then you are exempt from Capital gains tax

Mr. Incognito

Speak to a solicitor not an internet forum

Sheesh

Got2TurnAround

Thanks for the responses Geuze and Gard1.

@Geuze it was a solicitor's website I got that figure from. I just checked and it might not have been updated since 2009. Here is the info:

The group thresholds for 2009 are as follows:-

Group A: Child/Foster Child/Minor child of a deceased child €542,544.00

Group B: Lineal ancestor or lineal descendent, for example
brother/sister/child of brother or sistern € 54,254.00

Group C: All other relationships € 27,127.00

Therefore, you are allowed to receive gifts or inherences from both your parents to the total combined value of €542,544 without having to pay Gift Tax.

The Revenue website probably contains more up to date info.
@Gard1 This is my PPR (and has been for over 30 years), but not theirs. I know I am exempt from CGT, but would my children be liable for CGT if they sold the house after I die?

@Mr. Incognito I am hiring a solicitor to carry out the deed of transfer. Just wanted as much info as possible beforehand.

Atlantic Dawn

From my understanding they would be liable for CGT if they didn't live in the house and it was then sold for more than it was valued for when you transferred it to them.

Glass fused light

You can transfer it tax free on both sides if you structure it as their ppr for a fixed period of time, a tax accountant would be your first port of call as the solicitor will not be able to give you tax advise. From memory if set up correctly the CAT is not impacted.

Got2TurnAround

From my understanding they would be liable for CGT if they didn't live in the house and it was then sold for more than it was valued for when you transferred it to them.

Thanks Atlantic Dawn, so it's only if/when they sell that the CGT would become liable?

@Glass fused light Thank you for that suggestion, I may consult a tax accountant for some more advice.

Glass fused light

I would strongly recomend a visit to a tax accountant if there is any urgency in why you need to do the transfer as they would be able to give comprehensive advice specific to your and your childern's circumstances.
Plus advice you as to the potential changes in the upcoming budget.