Michael McGrath (Cork South Central, Fianna Fail)
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277. To ask the Minister for Finance if the exemption from income tax, capital gains tax and capital acquisitions tax on payments made to the women impacted by the failures in the CervicalCheck national screening programme, announced in Budget 2025, will also apply to payments to the family of persons deceased where awards were made by the court relating to CervicalCheck; and if he will make a statement on the matter. [44606/24]

Jack Chambers (Dublin West, Fianna Fail)
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The proposed exemption in respect of CervicalCheck payments is provided for under section 30 of Finance Bill 2024, as initiated. Subject to the enactment of the Bill, this section provides an exemption from Income Tax, Capital Gains Tax and Capital Acquisitions Tax on certain payments made to women who have been impacted by the failures in the CervicalCheck national screening programme.

The payments that come within scope of the Income Tax and the Capital Gains Tax exemptions are those made under-

(1) the CervicalCheck non-disclosure ex-gratia Scheme,

(2) the CervicalCheck Tribunal Act 2019,

(3) claims concluded by way of settlement, and

(4) court order.

Section 82(1) of the Capital Acquisitions Tax Consolidation Act (CATCA) 2003 already provides for an exemption from Capital Acquisitions Tax (CAT) for certain receipts, including the receipt of compensation and damages, which would apply to the CervicalCheck payments made under items (2) – (4) above. The Finance Bill 2024 amendment to section 82(1) of the CATCA 2003 provides that payments made under item (1) above will also be exempt from CAT.

Where the impacted woman was deceased when the payments were made, the exemption applies in respect of any payments made directly to her dependant(s). (Dependants includes spouse, civil partner, parent, grandparent, step-parent, child, grandchild, step-child, brother, sister, half-brother or half-sister of the deceased).

In addition, future and historic income and gains accruing to the impacted women from the investment and/or reinvestment of CervicalCheck payments received by them will also be exempt from Income Tax, Capital Gains Tax, Life Assurance Exit Tax, Investment Undertaking Tax and Deposit Interest Retention Tax.

John Lahart (Dublin South West, Fianna Fail)
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278. To ask the Minister for Finance to clarify the tax implications for both parents and married children in situations where the parents financially assist with home extensions or improvements on the children’s primary residence, including any relevant thresholds or exemptions under current tax legislation; and if he will make a statement on the matter. [44611/24]

Jack Chambers (Dublin West, Fianna Fail)
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I am advised by Revenue that where parents provide financial assistance to their children, including financial assistance to fund an extension or home improvements to the child’s primary residence, such financial assistance may come within the scope of Capital Acquisitions Tax (CAT).

CAT is a tax on gifts and inheritances payable by the person receiving the gift or inheritance (the beneficiary). CAT is calculated by reference to the value of the property received. A person receives a gift for CAT purposes when they receive a benefit, otherwise than on a death, and do not provide full consideration for that benefit.

For CAT purposes, the relationship between the person giving a gift or inheritance (i.e., the disponer) and the person who receives it (i.e., the beneficiary) determines the maximum amount, known as the “Group threshold”, below which CAT does not arise.

There are currently three Group thresholds:

• Group A threshold (currently €400,000) applies, inter alia, where the beneficiary is a child (including an adopted child, stepchild and certain foster children) of the disponer. Parents also fall within this threshold where they take an absolute inheritance from a child.
• Group B threshold (currently €40,000) applies where the beneficiary is a brother, sister, nephew, niece or lineal ancestor or lineal descendant of the disponer.
• Group C threshold (currently €20,000) applies in all other cases aside from gifts and inheritances between spouses and civil partners which are fully exempt from CAT.

In addition to the Group threshold, a person may receive gifts up to a total value of €3,000 from any person in any calendar year without having to pay CAT (the “small gifts exemption”). Gifts within this limit are not taken into account in computing tax and are not included for aggregation purposes. If both parents make gifts to their child and to their child’s spouse, both the child and their spouse can avail of small gift exemptions to the value of €6,000 in the particular calendar year.

In the scenario presented, the child will take a gift from their parent(s) in respect of the financial assistance received to facilitate an extension or improvements to their primary residence. CAT will be payable by the child at a rate of 33% to the extent that their gift, when aggregated with any prior gift or inheritance received since 5 December 1991, exceeds the Group A threshold.

Depending on the circumstances, the child’s spouse may also take a gift from their parents- in-law in respect of a share of the financial assistance provided. CAT would then be payable by the child’s spouse at a rate of 33% to the extent that their gift, when aggregated with any prior gift or inheritance received since 5 December 1991, exceeds the Group C threshold.

In addition, where the financial assistance is provided in the form of an interest free or low interest loan, the value of the interest-free portion of the loan may be chargeable to CAT.

If the individuals the Deputy refers to require a more definitive reply, they can present full details of the facts of the case to Revenue through the MyEnquiries facility in myAccount or by contacting the National Capital Acquisitions Tax (CAT) Unit at 01 738 3673.