Question about a Will.

humberklog

(Unsure if correct forum)

Re-doing my parents will.

They want everything split equally between their children.
They had 5 kids but my brother died a couple of years ago. He has a son in his 20's so naturally his deceased father's dividend should go to him. All grand.

My question is: would my parent's grandson incur heavier taxation on this money\property than their children (me and my siblings) ?

Robbo

humberklog wrote: »

(Unsure if correct forum)

Re-doing my parents will.

They want everything split equally between their children.
They had 5 kids but my brother died a couple of years ago. He has a son in his 20's so naturally his deceased father's dividend should go to him. All grand.

My question is: would my parent's grandson incur heavier taxation on this money\property than their children (me and my siblings) ?

The rate is the same, the threshold is significantly lower for a grandchild over a child.

garhjw

You should talk to a tax adviser about this. They will be able to suggest ways to reduce the tax burden

humberklog

Aha, that's what I was looking for re the tax bands but was googling all the wrong places.
Thanks a lot.


hmmm, plan B from may have to be dusted off.

hullaballoo

It's a bit late for Plan B now, that only works up to 72 hours after the deed and you said your man is in his 20s!

Mr. Incognito

There are situations where children step into the place of the deceased.

Speak to a solicitor or a tax advisor

Riskymove

Mr. Incognito wrote: »

There are situations where children step into the place of the deceased.

Speak to a solicitor or a tax advisor

absolutely

If you leave all the children on the will then his "estate" should inherit and then could pass to the grandchild

coylemj

garhjw wrote: »

You should talk to a tax adviser about this. They will be able to suggest ways to reduce the tax burden

Didn't they dismantle most of those tax dodging avoidance vehicles like family trusts when they introduced 'free' third-level education?

The CAT threshold for a grandchild is currently €32,500.

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

coylemj

Riskymove wrote: »

absolutely

If you leave all the children on the will then his "estate" should inherit and then could pass to the grandchild

'could' being the operative word. It could get complicated if you simply bequeath the estate to living and dead children, in that case the children of deceased children wouldn't necessarily inherit their parent's share of the estate because what happens is that the property is treated as if the deceased child was still alive and died immediately after the disponer. Meaning that how it's distributed would depend on the will left by the deceased child, which could be to a second spouse or the cats' and dogs' home and not the grandchildren.

If the grandparent wants children of their deceased children (i.e. their grandchildren) to inherit and share their parent's legacy and to cut out any sons or daughters in-law, it would remove any complications to state that the the assets be distributed per stirpes. So the will could state that you leave your property and residue in equal share to your children and in the event of any of your children predeceasing you, the distribution should be per stirpes.

davindub

coylemj wrote: »

Didn't they dismantle most of those tax dodging avoidance vehicles like family trusts when they introduced 'free' third-level education?

The CAT threshold for a grandchild is currently €32,500.

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

Pretty positive if the parent dies the child can take the parents threshold. It would have been the same effect if the parent inherited and then the child inherited from the parent. So 310k at the moment.

coylemj

davindub wrote: »

Pretty positive if the parent dies the child can take the parents threshold. It would have been the same effect if the parent inherited and then the child inherited from the parent. So 310k at the moment.

If the parent is dead then the legacy will pass direct from the grandparent to the grandchild, there is no interim or 'virtual' inheritance by the deceased parent so the grandchild threshold would apply.

Under certain circumstances, a 'favourite nephew/niece' can avail of the band 'A' threshold (310K) but there is no mention of any mechanism by which a grandchild can do this.

http://www.revenue.ie/en/tax/cat/guide/reliefs.html

davindub

coylemj wrote: »

If the parent is dead then the legacy will pass direct from the grandparent to the grandchild, there is no interim or 'virtual' inheritance by the deceased parent so the grandchild threshold would apply.

Under certain circumstances, a 'favourite nephew/niece' can avail of the band 'A' threshold (310K) but there is no mention of any mechanism by which a grandchild can do this.

http://www.revenue.ie/en/tax/cat/guide/reliefs.html

I double checked my tax manual. I didn't read your link but it seems too brief to be comprehensive, they often leave out elements in the guides, it could be there somewhere online, but anyway:

The child of a deceased child of the disponer is considered a child for CGT.

OP double check with a tax advisor who has experience in this field, it may be a minor child rather than adult child.

NUTLEY BOY

Also, the "child" needs to be aware that CAT exemption / threshold limits are aggregated throughout life.

So, if that child has already received other inheritances and or acquisitions within any particular category they are effectively deducted from the limits / thresholds of what is next received for calculation purposes.

+1 the advice about a tax adviser.