Inheritance tax threshold to increase to €400k

The amount that can a person can receive as a gift or inheritance from a relation before having to pay Capital Acquisitions Tax will be increased as part of Budget 2025.

The Group A threshold for CAT, which includes gifts or inheritance from parents to their children, will rise from €335,000 to €400,000.

The Group B threshold, which includes gifts or inheritances from siblings, will rise from €32,500 to €40,000.

Meanwhile the Group C threshold, which includes gifts and inheritances to relatives like uncles, aunts or cousins, will rise from €16,250 to €20,000.

The thresholds were last increased in 2019.

Minister for Finance Jack Chambers said that he believed the changes were appropriate, given the increase in property values in recent years.

"Changes announced in Budget 2025 in terms of Inheritance and Capital Acquisition Taxes will be welcomed across the country, in particular the increase in the Group A threshold for transfer within families to €400,000," said Alison McHugh, EY Ireland Head of Private Client Services.

"Changes to the Group B and Group C thresholds go further than have been expected, however, as these bands have not increased in many years, this has been some time coming," she added.