Do you Know the tax implications of gifting?

Small Gift Exemption

Gifts you make to or receive from any person, up to the value of €3,000 in a calendar year are exempt from Capital Acquisitions Tax (CAT). This means that you can make or receive a gift from several people:

• in the same calendar year

• and

• the first €3,000 is exempt from CAT.

  
  

Gifts of €3,000, as outlined above, are not taken into account in computing tax and are not included for aggregation purposes.

The Small Gift Exemption applies only to gifts and not to inheritances.

The disponer is the person who gives you the gift or inheritance. The person who receives the gift or inheritance is known as the beneficiary and the beneficiary is responsible for paying tax on the gift or inheritance.

How to claim the Exemption

A CAT return is not required to claim the Small Gift Exemption for annual gifts of up to €3,000.

A CAT return is only required when the taxable value of the gift exceeds 80% of the relevant group threshold. All prior taxable gifts and inheritances, received within the same group threshold since 05 December 1991, should be included in this calculation.

There are three group thresholds, based on the relationship between the beneficiary and the disponer. These are:

The taxable value of the gift is then reduced by the €3,000 small gift exemption.

Threshold Group	Tax Free Allowance	Who it includes
Group A	€400,000	A son or daughter of the person giving the gift or inheritance
Group B	€40,000	Other relatives, including parents, brothers, sisters, nieces, nephews. Also includes other direct descendants e.g. grandchildren.
Group C	€20,000	Everyone else

*These thresholds apply to all gifts and inheritances you receive in each group.

If required to file a return, you can claim the Small Gift Exemption by filing a CAT return Form IT38 online. This can be done through myAccount or Revenue Online Service (ROS). You can also file a paper Form IT38S, in certain circumstances.

Source: Revenue.