Peter Cleere (Carlow-Kilkenny, Fianna Fail)
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12. To ask the Minister for Finance if he plans any change to inheritance tax rules for people without any immediate family; and if he will make a statement on the matter. [15982/25]

Paschal Donohoe (Dublin Central, Fine Gael)
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Capital Acquisitions Tax (CAT) is a beneficiary-orientated tax that is charged on gifts and inheritances that is payable by the recipient (i.e. the beneficiary) as opposed to the person providing that gift or inheritance (i.e. the disponer). ?CAT is not payable on gifts or inheritances if the taxable value is below a particular lifetime threshold and the applicable threshold depends on the beneficiary’s relationship to the disponer. CAT of 33% is payable on the value above the tax-free group threshold amount. Where tax is payable, I recognise that this tax can arise at what is a difficult time in peoples lives. It is important to note that there are a number of exemptions and reliefs from this tax that may apply depending on the circumstances of the case, some of which do not require that any specific family relationship applies. One such exemption is the CAT dwelling house exemption. To qualify for the exemption, the inherited property must have been the disponer’s principal private residence at the date of death. ? The beneficiary must also have lived in the house for 3 years prior to the date of the inheritance and must continue to live in the house for 6 years after that date.In addition, nieces or nephews may qualify for favourite niece or favourite nephew relief in respect of gifts or inheritances of business assets. Qualifying nieces or nephews are those who have worked substantially on a full-time basis for a period of five years prior to the gift or inheritance.My officials will be reviewing CAT as part of the annual Tax Strategy Group deliberations. These papers outline the tax policy considerations for the Government and the potential options available to it in forming this year’s Budget.Finally, it is important to be aware that the options available for making changes to CAT must be considered in the context of available resources and must also be balanced against competing demands.

Shay Brennan (Dublin Rathdown, Fianna Fail)
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13. To ask the Minister for Finance his plans to review the capital acquisitions tax rate; and if he will make a statement on the matter. [15985/25]

Paschal Donohoe (Dublin Central, Fine Gael)
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Capital Acquisitions Tax (or “CAT”) is a tax which applies to both gifts and inheritances and is charged at a rate of 33%. For CAT purposes, the relationship between the person giving a gift or inheritance and the person who receives it determines the maximum amount, known as the “Group threshold”, below which CAT does not arise.

Along with tax free group thresholds, various reliefs and exemptions are available in relation to CAT, including agricultural and business relief. There is also the small gift exemption, favourite niece or nephew relief, and the dwelling house exemption.

In general, the availability of specific reliefs in respect of a particular tax head often requires a higher rate in order to generate an appropriate yield. It is important from a tax policy perspective to maintain stability and certainty, and to ensure that the CAT rate is appropriately set in the context of the range of reliefs and tax-free thresholds available.

CAT policy and legislation is reviewed by the Tax Strategy Group, as part of the annual Budget and Finance Bill process. It is also considered in the wider tax policy context, where available resources as well as the need to balance against competing demands must be taken account of.