Dwelling House Relief
Tax legislation provides a relief from CAT for the transfer of a dwelling house, where the recipient has resided in that property for the previous three years, and the recipient did not have a beneficial entitlement to a property prior to the transfer. The value of the property is not taken into account when calculating the tax free threshold for future gifts or inheritances. Therefore a parent could gift a house to a child, without reducing the tax free amount that the child can be gifted or inherit in the future, provided the condition of the dwelling house exemption are met.
Beware; Any period where both parent and child occupy the house at the same time as their main residence, cannot be taken into account by the child for the purposes of the three year rule outlined above.
Pointer; This restriction can be overcome if the parent is dependent on the child due to old age or infirmity.
If you would like to arrange a consultation to draft a will, you can contact us on 01 872 5255 or by email to [email protected]