Capital Acquisitions Tax – Deed of residency

indy_man · 04-09-2023 11:50am #1

I am trying to inherit my parents house, they are both alive.

I heard that if I can place a deed of residency on the house for them then I can avoid the CAT at 33%.

Is this true, seems to good to be ture?

Thanks

Deeec · 04-09-2023 11:52am

https://www.boards.ie/discussion/2058312216/capital-acquisitions-tax-deed-of-residency

Whats the value of your your parents house?

Have you received any gifts from them previously which has used up your CAT threshold?

Viscount Aggro · 04-09-2023 11:58am

Dwelling house exemption. A parent has to will the property to you.

Its very restrictive.

indy_man · 04-09-2023 12:02pm

https://www.boards.ie/discussion/comment/121067240#Comment_121067240

Does that relate to a deed of residency?

I can't find any information about this.

Deeec · 04-09-2023 12:07pm

https://www.boards.ie/discussion/comment/121067255#Comment_121067255

OP you need to be living in the house as your main residence, you cant own another house and you need continue to live there a number of years after transfer to avail of dwelling house relief.

You need to give us more info regarding your situation.

indy_man · 04-09-2023 12:36pm

I live in and own another house, I am inheriting my parents house, I am going to place a deed of residency for them on their house.

This I thought was sufficient for me to avail of a CAT exception. Am I incorrect.

banie01 · 04-09-2023 12:41pm

https://www.boards.ie/discussion/comment/121067423#Comment_121067423

You can't avail of Dwelling House exemption if you own or have an interest in another house.

https://www.revenue.ie/en/gains-gifts-and-inheritance/cat-exemptions/dwelling-house/qualifying-conditions-gift-on-after-251216.aspx

Deeec · 04-09-2023 1:04pm

https://www.boards.ie/discussion/comment/121067423#Comment_121067423

You can inherit up to the value of €335,000 form your parents without payment CAT. This is a lifetime limit so any gifts given to you by your parents already will have eaten into this threshold. Have you received any gifts from your parents before?

You cannot avail of dwelling house relief if you already own your own house

A deed of residency just gives your parents security - nothing to do with CAT

indy_man · 04-09-2023 1:25pm

I have some of my limit left over but not enough to cover the house I am inheriting. I am left with a tax bill of about 20K, so I was hoping the dwelling house relief might help. But it seems it can't in my scenario.

Marcusm · 04-09-2023 7:50pm

You seem to have created this phrase “deed of residency”; can you explain what you understand it to mean.

DFB-D · 05-09-2023 12:13am

You mean a transfer of the property subject to a limited interest.

You wont avoid CAT, but you can postpone based on Revenue calculations.

Best to get professional advice on this.

indy_man · 05-09-2023 1:27pm

Thanks.

A deed of residency is a legal agreement that someone can live in a property they don't own for the rest of their lives.

Capital Acquisitions Tax – Deed of residency

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