Inheritance tax

puddles59

If a sibling buys a property for another sibling the inheritance tax would be crippling. Any suggestions on any way of reducing it would be greatly appreciated TIA

Mrs OBumble

Gift it to thema year, 3k, over a long period.

20/20

https://www.boards.ie/discussion/comment/122974903#Comment_122974903

I think the 3k is only for parent to child.

rustyfrog

Cant think of any Galway City or County specific ways of reducing your tax on this, sorry.

puddles59

OK thanks everyone

phormium

https://www.boards.ie/discussion/comment/122974933#Comment_122974933

Not correct, you can give anybody a gift of 3k per annum tax free, nothing to do with parent to child.

MIKEKC

https://www.boards.ie/discussion/comment/122974933#Comment_122974933

NNo itsto anyone

JVince

If you are a cash buyer, then look at a formal loan agreement with the sibling at an interest rate of 0.5%

Then, if you have a spouse or partner, contribute 3k each into the loan account every year and possibly the sibling also makes a contribution.

If the sibling has a spouse or partner, and you have a spouse or partner, the annual contribution could be €12,000.

In a way it's financial engineering, but nothing wrong once it's not some €1m house and the figures have no chance of adding up.

But I would make sure the sibling makes some form of contribution.

puddles59

Thank you.that's very helpful.

ottolwinner

have you consulted with a financial advisor and tax specialist?

puddles59

NO not yet..it's really a case of 1 sibling getting their parents house while parents are still alive and the other sibling getting a house bought for them in lieu ..

1641

https://www.boards.ie/discussion/comment/122977481#Comment_122977481

So why not let the sibling pay the parents for the house? The house is signed over to this sibling with a parents' right of residence. If he is paying less than the market price the balance can be a gift from the parents (no CAT up to €400,000 cumulative).

The parents then give this money to the other sibling to buy a house for him or herself (again no CAT up to €400,000 cumulative).

Its CAT by the way, not inheritance tax (no such thing).

Pen Rua

Tax on inheritances is, technically, called inheritance tax. See s9 CATCA.

OP - engage professional advice. There are a lot of moving parts here between a house and cash. At least try a forum other than a niche regional forum. Irish Personal Finance on Reddit is active. But you’ll probably get the same answer - seek professional advice.

magicbastarder

https://www.boards.ie/discussion/comment/122977481#Comment_122977481

The sibling getting the parents house will have to pay inheritance tax on it if it's above a certain value, if they're not living in it currently.

The arrangement you've outlined seems messy, one sibling will be benefiting from the tax free parent to child threshold, but the second sibling will have to deal with the sibling to sibling threshold. Not an equitable arrangement.

puddles59

Thank you very much. I really appreciate your advice

puddles59

Thank you very much. Advice is much appreciated.