Seán Fleming (Laois-Offaly, Fianna Fail)
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174. To ask the Minister for Finance the situation regarding the capital gains tax payable by a landowner who transfers a site to a relation for no consideration; the liability that attaches to the person who transfers the site and the liability that attaches to the person who receives the site; and if he will make a statement on the matter. [22160/13]

Michael Noonan (Limerick City, Fine Gael)
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The transfer of a site for no consideration is a disposal for capital gains tax purposes by the transferor. The legislation relating to transfers for no consideration specifies that such a transfer is treated as if it were for a consideration equal to the market value of the site at the date of the transfer. The transferor is liable to capital gains tax in respect of the transfer of the site if a chargeable gain arose between the time that he or she acquired the site and the time of its disposal. The transferee does not have a liability to capital gains tax in respect of the transfer. However, he or she might have a liability to gift tax in respect of the transfer. Any capital gains tax paid by the transferor in respect of the transfer is allowed as a credit against the gift tax payable, but the credit is clawed back where the asset is disposed of within 2 years of the gift. In addition, a liability to stamp duty arises on the transferee in respect of the transfer. It should be noted that there is an exemption from capital gains tax where an individual transfers a site to his or her child (including a child of his or her civil partner or a foster child in certain circumstances) to enable the child to build a house on the site to be occupied as that child’s only or main residence. The value of the site must be less than €500,000 and the area of the site must be less than 0.4047 hectare. If the child disposes of the site or part of the site without a house having been built on the land, then the chargeable gain that was exempted is treated as accruing to the child at the time of the disposal.