Estate Planning
Plan how to pass wealth to your family in Ireland
Passing wealth to the next generation starts with deciding what you want that wealth to do. You may want to help children buy a home, support grandchildren with education or keep a family business intact. A good estate plan considers who should benefit, when they should receive support and what you need to retain for your own retirement and care.
Understand Irish gift and inheritance tax
Capital Acquisitions Tax (CAT) is generally paid by the person receiving a gift or inheritance. The tax-free threshold depends on their relationship to the person giving it. Gifts and inheritances between spouses or civil partners are generally exempt.
Group | Common examples | Threshold |
|---|---|---|
A | A child receiving a gift or inheritance from a parent | €420,000 |
B | A sibling, grandchild, niece or nephew receiving a gift or inheritance | €44,000 |
C | Other relationships, such as friends or cousins | €22,000 |
These thresholds apply to benefits taken on or after 7 October 2026. The examples are not exhaustive: special rules can change the group that applies. Revenue: CAT group thresholds.
Each threshold is shared across taxable gifts and inheritances in the same group received since 5 December 1991. It is not a fresh allowance for each donor. For instance, taxable benefits from both parents generally use the same Group A threshold. CAT is generally charged at 33% on the taxable amount above the remaining threshold. A return can be required before tax is due, so keep a record of earlier benefits. Revenue: Calculating CAT.
Consider giving during your lifetime
Lifetime gifts can help family members when they need support most. Under the Small Gift Exemption, a person can receive up to €3,000 from each donor in a calendar year without using their CAT threshold. Two parents can therefore each give €3,000 to the same child in a year, giving the child €6,000 in exempt gifts. The exemption applies to gifts, not inheritances. Revenue: Small Gift Exemption.
Before transferring property, investments or business interests, check the tax and practical consequences for both sides. A transfer may have Capital Gains Tax or stamp duty implications even when no money changes hands. Agricultural Relief, Business Relief and the Dwelling House Exemption may help in specific cases, but each has conditions. Check eligibility before relying on a relief, and make sure you can afford to give up the asset or the income it produces.
Plan how the tax bill will be paid
A family may inherit a valuable property or business without receiving enough cash to pay the tax. Planning for that cash shortfall can reduce the risk of a hurried sale. Sections 72 and 73 offer two ways to set aside money for qualifying tax bills. They do not remove the tax on the underlying gift or inheritance.
Section 72: funding inheritance tax
A qualifying Section 72 life assurance policy is designed to provide funds on death to pay inheritance tax. The proceeds are exempt from CAT to the extent they are used to pay qualifying inheritance tax within the applicable time limit and the statutory conditions are met. Excess proceeds can themselves be treated as an inheritance for CAT purposes.
Estimate the likely tax bill for each beneficiary and compare it with cash already available. Check who should own the policy, how it will interact with your will, what premiums are affordable and how the proceeds will reach the people who need to pay the tax. Revisit the amount of cover if asset values, beneficiaries or tax rules change. Goodbody: Passing on property.
Section 73: funding tax on a planned lifetime gift
A qualifying Section 73 policy can help you build a fund over time for tax on a planned lifetime transfer. It may suit a gift that is still years away. It is not a way to fund an immediate transfer: the ordinary statutory timing rule requires at least eight years before the appointed date, and the qualifying gift must be made within one year after that date.
Check premium and withdrawal conditions, charges, investment risk and the timing of the gift with your adviser. The relief applies only to proceeds used for qualifying tax under the rules. The fund may fall short of the bill, and unused proceeds can themselves be treated as a gift for CAT purposes. Zurich Ireland: Section 73 · Revenue: Sections 72 and 73.
Bring your family plan together
- List your assets, ownership, debts and intended beneficiaries.
- Estimate what you need for retirement, emergencies and possible care costs before making gifts.
- Review your will with your solicitor and check how jointly owned assets, pension benefits and insurance policies are dealt with.
- Estimate each beneficiary’s tax exposure using their relationship and earlier gifts and inheritances.
- Compare available cash, lifetime gifts and qualifying insurance or savings policies. Agree who will act and when to review the plan.
Talk to Indigo Investment Group
We can help you assess what you can afford to pass on and how your family could fund any tax due. Contact enquiries@iig.ie to discuss tailored financial advice alongside advice from your solicitor and tax adviser.
Important information
This guide provides general information for Ireland, not personal financial, legal or tax advice. Tax rules, policy terms and asset values can change. Check the position before making a gift, changing your will or taking out a policy. Where a policy is invested, its value can fall as well as rise and you may get back less than you invest.