Budget 2025 - CAT threshold increases

Capital Acquistions Tax (CAT) is a tax on inheritances. An individual can receive a certain amount of gifts or inheritance without having to pay CAT.

Budget 2025, announced by the Minister for Finance, Jack Chambers, has increased the CAT thresholds.?The changes are as follows:

Group A – for transfers to children, the threshold was raised from €335,000 to €400,000;

Group B- for transfers to a brother, sister, parent, niece, nephew or grandchildren, the threshold has increased from €32,500 to €40,000;

Group C – for all other beneficiaries, the threshold has increased from €16,250 to €20,000

Any amount received above these thresholds is subject to CAT at a rate of?33%.

Exemptions

There are specific exemptions that can help lower the tax liability on gifts and inheritances. One example is the Spousal or Civil Partner exemption, which allows gifts or inheritances from a spouse or civil partner to be completely tax-free.

Another is the Small Gifts Exemption, which permits individuals to receive gifts of up to €3,000 from any one person within a calendar year without incurring any tax.

Contact us

If you wish to discuss the impact of the increased CAT thresholds in the context of succession planning, we would be delighted to discuss with you further. You can arrange an appointment by contacting 057 9351755