Paschal Donohoe (Dublin Central, Fine Gael)
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Section 53 amends section 46 of the Capital Acquisitions Tax Consolidation Act 2003, which section provides for the submission of tax returns to Revenue. Section 46 requires the submission of a capital acquisitions tax return where the taxable value of gifts or inheritances within the same group threshold exceeds 80% of the value of that group threshold. This 80% threshold value is calculated by aggregating the value of the current gift or inheritance with the value of previous gifts or inheritances received by a beneficiary.

Section 89 of the Capital Acquisitions Tax Consolidation Act 2003 provides for agricultural relief. The relief takes the form of a 90% reduction in the taxable value of gifted or inherited agricultural property in certain circumstances. Section 90 provides for business relief, which similarly reduces the taxable value of qualifying business property by 90%. The effect of these reliefs on taxable value is that high value property can be received as gifts or inheritances without a requirement for the recipient to submit a return to Revenue.

The current group A threshold, which applies where property is transferring from parents to their children, is €335,000. This means that a person could potentially receive benefits comprising agricultural or business property with a taxable value of up to €2.68 million without having to submit a return.

Agricultural relief and business relief are valuable reliefs and it is essential for the development of capital acquisitions tax policy that the extent to which these reliefs are being availed of, and the cost of the reliefs, is known. In addition, information about the transfer of significant wealth is important from a Revenue compliance programme perspective which, to operate effectively, requires awareness that the reliefs are being claimed, the examination of returns and follow-up investigation if required.

This amendment to section 46 therefore requires the submission of a return when the gift or inheritance comprises agricultural or business property that qualifies for relief, irrespective of the value of that property. Given that beneficiaries would not tend to receive multiple gifts of such property during their lifetime, I do not consider that this new requirement will be onerous, and I am satisfied that the value to be gained from this additional information justifies the new requirement.