Jack Wall (Kildare South, Labour)
Link to this: Individually | In context

Question 211: To ask the Minister for Finance if inheritance tax is payable by a person in relation to the transfer of family lands (details supplied); and if he will make a statement on the matter. [31940/08]

Brian Lenihan Jnr (Dublin West, Fianna Fail)
Link to this: Individually | In context

I am advised by the Revenue Commissioners that for the purposes of both Gift and Inheritance Tax, the relationship between the person who provides the gift or inheritance and the person who receives the gift or inheritance, determines the maximum tax-free threshold known as the "Group Threshold". The Group threshold applying to a gift or inheritance received by a grandchild from a grandparent is the Group B threshold and, for 2008, this threshold figure is €52,121. Any other gifts/inheritances that might have been received by the grandchild from grandparents since 5 December 1991 will also be taken into account when applying the threshold for the purposes of calculating the gift/inheritance tax.

If, therefore, the value of the site now being transferred, plus the value of any other gifts/inheritances received by the grandchild from grandparents since 5 December 1991, exceeds the Group B tax-free threshold of €52,121, gift/inheritance tax would be payable on the excess over this tax-free threshold figure at the rate of 20%. Also, where a person receives a gift as opposed to an inheritance of property, the first €3,000 of the value of the gift is ignored for tax purposes by way of an annual small gift exemption.

Where a gift or inheritance consists of agricultural lands, as distinct from the transfer of a site, the market value of the agricultural lands may be reduced by 90% for tax purposes provided certain conditions are met. The conditions attaching to the relief are that the land is taken by a "farmer", who is defined in the legislation as an individual in respect of whom not less than 80 per cent of his or her assets, after taking the gift or inheritance, consist of agricultural property and also that the land is not disposed of for 6 years after the date of the receipt of the gift or inheritance.