Tony McLoughlin (Sligo-Leitrim, Fine Gael)
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96. To ask the Minister for Finance if consideration will be given in future finance Bills which would enable the capital gains tax 33% to be lowered for certain legal separation cases when the sale of a divorcing couple's shared property will have to be used to provide new accommodation for a family member with a disability; and if he will make a statement on the matter. [35278/16]

Michael Noonan (Limerick City, Fine Gael)
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I am advised by Revenue that a capital gains tax (CGT) relief applies in respect of a gain made by a couple who are legally separating on the disposal of their family home together with land occupied as its gardens or grounds up to an area (exclusive of the site of the residence) of one acre. For full relief to apply, the house must have been occupied by the individuals as their family home throughout the period during which they owned the property. Where the house was not so occupied during the whole period of ownership, only the proportion of the gain applicable to the period of occupation is exempt from CGT.

However, the exemption would continue to apply in circumstances where, after the legal separation, the house is occupied by one of the parties as his or her principal private residence.

In any event, the last 12 months of the period of ownership is treated as a period of occupation for the purposes of the relief.

Relief is also available in respect of a gain arising on the disposal of a house or part of a house which, during the period of ownership, was the sole residence of a dependent relative. A dependent relative means a relative of the individual who is incapacitated by old age or infirmity from maintaining himself or herself. For the relief to apply, the house must have been provided rent-free for the dependent relative.

Gains arising in respect of other jointly owned property such as, for example, a property which was held by a divorcing or separating couple as an investment are liable to CGT at the rate of 33%. The first €1,270 of a gain accruing to an individual in a tax year is exempt from CGT. 

I do not propose to introduce a relief from disposals of property other than the owners' home in the circumstances outlined by the Deputy. The situation described is very specific and to introduce a relief for it would mean moving towards a situation where tax policy is designed not on general principles of equity and efficiency but for the benefit of specific individuals.

Robert Troy (Longford-Westmeath, Fianna Fail)
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97. To ask the Minister for Finance the reason a person (details supplied) does not qualify for inheritance tax. [35289/16]

Michael Noonan (Limerick City, Fine Gael)
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It is assumed that this question concerns the eligibility of the person concerned for Favourite Nephew Relief.  Favourite Nephew Relief is provided for in the Capital Acquisitions Tax Consolidation Act 2003 (Schedule 2, Part 1, Paragraph 7).  This relief applies to a niece or nephew who has worked substantially on a full-time basis for the disponer for the period of five years ending on the date the disponer ceases to have a beneficial interest in the business, including farming. The relief only applies to assets used in connection with the business.  

To qualify for the relief, the beneficiary must have worked a minimum number of hours in the disponer's business, i.e.

- 15 hours per week in a small business, i.e. a business carried on exclusively by the disponer, the disponer's spouse or civil partner and the nephew/niece.

- 24 hours per week in a larger business, i.e. where there are other employees.

I am advised by Revenue that a Capital Acquisition Tax Return (IT38) was made on 1 November 2016. No claim to relief was made, either by the person himself or his agent.  The "Additional Information" provided by the agent in the case is not sufficient to make a definitive determination on eligibility for Favourite Nephew Relief.  If the person concerned or his agent considers that Favourite Nephew Relief applies, the supporting information  should be forwarded to Revenue's BMW Region at the CAT Centralised Office, Government Offices, Millennium Centre, Dundalk, Co Louth.