Colm Burke (Cork North-Central, Fine Gael)
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310. To ask the Minister for Finance whether those who exceeded their group A capital acquisition tax threshold of €335,000 under their prior threshold rules are enabled to avail of the €400,000 group A threshold introduced as part of Budget 2025; and if he will make a statement on the matter. [9556/25]

Paschal Donohoe (Dublin Central, Fine Gael)
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Capital Acquisitions Tax (CAT) is a tax on gifts and inheritances that is payable by the beneficiary of a gift or inheritance on the value of the property received.

The relationship between the person providing the gift or inheritance (the disponer) and the person receiving it (the beneficiary) determines the tax-free threshold (Group threshold) below which CAT does not arise. Any prior gift or inheritance received by a person since 5 December 1991 from within the same Group threshold is aggregated for the purposes of determining whether any CAT is payable on a gift or inheritance. Where a person receives gifts or inheritances that are in excess of the relevant Group threshold, CAT at a rate of 33% applies on the excess. There are three Group thresholds.

The Group A threshold, which is the threshold relevant to the Deputy’s query, applies inter alia, where the beneficiary is a child (including adopted child, stepchild and certain foster children) of the disponer, and includes certain inheritances taken by a parent from their child. It was increased from €335,000 to €400,000 in Budget 2025. There were also increases to the Group B and C thresholds.

The increased Group thresholds apply to gifts and inheritances taken on or after 2 October 2024.

I am informed by Revenue that in the case of an individual who received gifts or inheritances prior to 2 October 2024 which exceeded the previous Group A threshold of €335,000, the increased Group A threshold of €400,000 will be available to them to the extent that the aggregate value of all prior benefits received by that individual since 5 December 1991 did not exceed €400,000. For example, where an individual, who had taken no previous benefits, received a gift of a house from a parent valued at €360,000 in 2023, CAT would have applied at a rate of 33% on €25,000, being the amount by which the value of the gift exceeded the previous Group A threshold of €335,000. If the individual receives a cash gift of €50,000 from a parent on 1 March 2025, CAT would be applied on €10,000, being the amount by which the value of the cash gift (€50,000) when aggregated with the value of the previous gift (€360,000) exceeds the increased Group A threshold of €400,000.