CAT issues around uncle selling property to nephew

ceekay74 · 2015-07-24 16:40:13

In a situation where an uncle sells a property (valued at €250,000) to his nephew significantly below the market value (say €100,000), does CAT & gift tax kick in on the other 150,000?

24-07-2015 05:40PM

#1

ceekay74

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In a situation where an uncle sells a property (valued at €250,000) to his nephew significantly below the market value (say €100,000), does CAT & gift tax kick in on the other 150,000?

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#2 24-07-2015 05:45PM

seamus

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In short, yes. That €150k is considered to have been "gifted" to the nephew.

There may also be implications if they only pay €1,000 stamp duty.

Such people would be strongly advised to talk to a professional advisor about the best way forward.

For example, if the nephew were instead to live in the property as the sole occupier, after 3 years the uncle can gift him the property, CAT-free.

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#3 24-07-2015 08:32PM

nompere

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But such an uncle would also want to check whether he has a capital gains tax liability based on the full market value of €250,000 and not the reduced figure he might sell at.

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