Catherine Martin (Dublin Rathdown, Green Party)
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55. To ask the Minister for Finance if he is considering any relief measures to address the problem of persons and families with low cash incomes who may be forced to lose their homes in the context of the abolition of the dwelling house exemption in part 5 of the Finance Bill 2016; and if he will make a statement on the matter. [37928/16]

Michael Noonan (Limerick City, Fine Gael)
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The Finance Bill 2016 has just been passed by Dáil Éireann and is due to be considered by the Seanad in December.  In Section 52 of the Bill, I have provided for an amendment to section 86 of the Capital Acquisitions Tax Consolidation Act 2003, the section that provides an exemption from capital acquisitions tax on the inheritance or gift of a dwelling house in certain circumstances. The proposed amendment to this section does not abolish the dwelling house exemption in full but will act to deny the exemption in circumstances that are not in line with the original policy objective of the exemption. That policy objective remains to alleviate hardship and in particular to ensure that it should not be necessary for members of a family who resided together over an extended period to have to dispose of the family home in order to meet a capital acquisitions tax liability. I would like to assure the Deputy that my amendment will ensure that this continues to be the positon.

The proposed amendment will have two effects. Firstly, the dwelling house exemption will only be available for inheritances. With one exception, it will no longer be possible to receive a tax-free gift of a dwelling house. The exception will be where a person gifts a dwelling house to a dependent relative. For this purpose, a dependent relative is a direct relative of the donor, or of the donor's spouse or civil partner, who is permanently and totally incapacitated because of physical or mental infirmity from maintaining himself or herself or who is over the age of 65.

Secondly, the inherited dwelling house must have been the deceased person's principal private residence at the date of his or her death. This requirement will be relaxed in situations where the deceased person had to leave the house before the date of death because of ill health; for example, to live in in a nursing home.

In relation to an inability to pay any capital acquisitions tax that may be due, I have been advised by Revenue that a person who inherits a dwelling house but who does not qualify for the exemption is entitled to pay any tax due by instalments over a period of five years, subject to interest. Revenue also have the discretion to allow payment over a longer period, to delay payment and to waive the interest charges in cases of genuine hardship.