Denis Naughten (Longford-Roscommon, Fine Gael)
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Question 192: To ask the Minister for Finance the maximum value of cash which can be transferred to a niece or nephew which is exempt under inheritance tax: when the level was last increased; his plans to increase this threshold; and if he will make a statement on the matter. [13990/07]

Brian Cowen (Laois-Offaly, Fianna Fail)
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I am informed by the Revenue Commissioners that for the purposes of both Gift and Inheritance Tax, the relationship between the person who provided the gift or inheritance (i.e. the disponer) and the person who received the gift or inheritance (i.e. the beneficiary), determines the maximum tax-free threshold — known as the "Group threshold". Three Group thresholds were are based on the relationship of the beneficiary to the disponer and these Group thresholds are indexed annually by reference to the Consumer Price Index. The following are the Group thresholds for 2007:

Group A: €496,824 — applies where the beneficiary is a child (including certain foster children) or minor child of a deceased child of the disponer. Parents also fall within this threshold where they take an inheritance from a child.

Group B: €49,682 — applies where the beneficiary is a brother, sister, niece, nephew, or lineal descendant of the disponer.

Group C: €24,841 — applies in all other case.

In relation to the specific question raised by the Deputy, it is important to note that all gifts / inheritances that might have been received by the niece or nephew in question from within the same Group B (i.e. from brothers, sisters, uncles, aunts or grandparents) since 5 December 1991 will also be taken into account when applying the threshold for the purpose of calculating whether any inheritance tax arises. If there have been none, other than "small gifts", then the maximum value of cash, which can be transferred to a niece or nephew, without a liability to Inheritance Tax arising, is €49,682, which is the current Group B threshold.

"Small Gifts" are gifts from any source of less than €3,000 in any one year. These are exempt from Gift/Inheritance tax.

I have no plans to increase the Group B thresholds.