CAT Probate Question

toomefc

Hi All

My husband’s Dad passed away on 8th Oct 2015. We had another family bereavement & had a baby at the start of this year so Probate just went to the back of the queue.. We’re just starting to look at it now

Just for confirmation I can see that the threshold for CAT has changed significantly since his death.

Pre 13 Oct 15 - €225k
Post 13 Oct 15 - €280K
Post 12 Oct 16 - €310K

His estate is quite straight forward. Total value is €320k. Just want to confirm that our threshold will be the €225K ie the date of death & not €310k ie the date we start probate

Any help is hugely appreciated

Squatter

toomefc wrote: »

Just want to confirm that our threshold will be the €225K ie the date of death & not €310k ie the date we start probate

Good news! Your assumption is incorrect!


"The tax free group thresholds and rates of tax that apply when you receive a gift or inheritance are determined by the date on which you received the benefit and not by the valuation date."


http://www.revenue.ie/en/gains-gifts-and-inheritance/valuation-date-and-the-value-of-certain-benefits/what-is-the-valuation-date.aspx

toomefc

Thanks Squatter

My thought process was that CAT threshold was calculated on the date of death per below???

"The date of an inheritance is usually the date of death of the person leaving the inheritance. These dates determine the Capital Acquisitions Tax (CAT) rates and the group threshold that apply"

Won't let me post the link but this is straight from the reveue website

Squatter

toomefc wrote: »

Thanks Squatter

My thought process was that CAT threshold was calculated on the date of death per below???

"The date of an inheritance is usually the date of death of the person leaving the inheritance. These dates determine the Capital Acquisitions Tax (CAT) rates and the group threshold that apply"

Won't let me post the link but this is straight from the reveue website

That's curious! Because, as you can see, the sentence that I posted was taken directly from the CAT area of the Revenue website. And it couldn't be clearer.

nompere

Squatter wrote: »

That's curious! Because, as you can see, the sentence that I posted was taken directly from the CAT area of the Revenue website. And it couldn't be clearer.

If you read the notes for guidance on the legislation, you will find:

In the majority of cases, the “date of the inheritance” will be the date of death of the disponer.

http://www.revenue.ie/en/tax-professionals/documents/notes-for-guidance/cat/cat-act-guidance-notes-2015.pdf

The bit you highlighted is clear enough, but it doesn't define the date on which a benefit is received.

Squatter

nompere wrote: »

If you read the notes for guidance on the legislation, you will find:

In the majority of cases, the “date of the inheritance” will be the date of death of the disponer.

http://www.revenue.ie/en/tax-professionals/documents/notes-for-guidance/cat/cat-act-guidance-notes-2015.pdf

The bit you highlighted is clear enough, but it doesn't define the date on which a benefit is received.

Thanks - I'm sure that you and the OP are quite correct.

But, me not being a tax professional, I would contend that Revenue's words "the date on which you received the benefit" would (to most people) suggest the date on which the person received the cheque from the executor.

There's not much point in someone being deemed to have received a benefit on the date of death, if they don't actually get their hands on the said benefit until years later!

nompere

That's why the valuation date is different, because that fixes the date on which the tax has to be paid.

Pawwed Rig

There is not enough info here to answer your question. Different assets will have different dates of receipt. Hire a tax professional.