Inheritance Tax in Ireland: What You Actually Owe (CAT Explained)
If you've inherited money, property, or other assets in Ireland — or expect to — the tax involved isn't called "inheritance tax" here, and that trips a lot of people up. It's called Capital Acquisitions Tax, or CAT, and it works differently from the systems in the UK, the US, and most other countries.
Three differences matter most: the tax falls on you rather than the estate, your allowance is a lifetime total rather than a per-inheritance one, and the filing deadline depends on a date most people have never heard of. We'll take them in order.
It's your tax, not the estate's
In Ireland, CAT is charged to the person receiving the gift or inheritance. It isn't deducted from the estate before distribution, and the executor doesn't settle it on your behalf. The money arrives, and the obligation is yours.
That means two siblings inheriting identical amounts can end up with very different bills. If one received substantial gifts from a parent fifteen years ago and the other didn't, they're not in the same position — because the threshold is cumulative and personal to each beneficiary.
It also means that if you receive a gift or inheritance while living in Ireland, nobody is going to tell you that you owe something. There's no payslip, no deduction, no letter. Revenue finds out when you file, or afterwards.
The three groups
Your tax-free threshold depends on your relationship to the person giving you the asset — the disponer, in Revenue's language.
| Group | Threshold | Who it covers |
|---|---|---|
| A | €400,000 | A child inheriting from a parent (including adopted and stepchildren), and in some cases a parent inheriting an absolute interest from a child |
| B | €40,000 | Siblings, nieces and nephews receiving from an aunt or uncle, grandchildren, and lineal ancestors such as grandparents |
| C | €20,000 | Everyone else — including aunts and uncles, cousins, grandnieces and grandnephews, in-laws and friends |
Anything above your relevant threshold is taxed at a flat 33%.
Two directional traps worth knowing. A niece receiving from an aunt or uncle is Group B — but an aunt or uncle receiving from a niece or nephew is Group C. The relationship isn't symmetrical. And an inheritance of a limited interest, rather than an absolute one, can fall into a different group than you'd expect.
The critical feature is that these are lifetime totals. Your Group A threshold isn't €400,000 per parent or per inheritance — it's €400,000 across everything you've received in that group from any source since 5 December 1991. Gifts from twenty years ago still count against it.
A concrete example
Say a parent leaves €450,000 to their child and €50,000 to their niece.
The child falls under Group A, with a €400,000 threshold:
| Calculation | Amount | |
|---|---|---|
| Inheritance | €450,000 | |
| Less Group A threshold | −€400,000 | |
| Taxable | €50,000 | |
| CAT at 33% | €50,000 × 33% | €16,500 |
The niece falls under Group B, with a €40,000 threshold:
| Calculation | Amount | |
|---|---|---|
| Inheritance | €50,000 | |
| Less Group B threshold | −€40,000 | |
| Taxable | €10,000 | |
| CAT at 33% | €10,000 × 33% | €3,300 |
Both of them must file, because both received more than 80% of their threshold — more on that below.
Now add the part that surprises people. Suppose the niece had also received €25,000 from her grandmother back in 2016. That's also a Group B benefit, so it aggregates:
| Amount | |
|---|---|
| Inheritance now | €50,000 |
| Previous Group B benefit (2016) | €25,000 |
| Total Group B benefits | €75,000 |
| Less threshold | −€40,000 |
| Taxable | €35,000 |
| CAT at 33% | €11,550 |
The same €50,000 inheritance produces a bill of €11,550 rather than €3,300, because of a gift received a decade earlier. This is why "how much did I inherit?" is never the whole question.
What's fully exempt
Transfers between spouses and civil partners are completely exempt from CAT, regardless of amount, and don't touch any threshold.
The Small Gift Exemption lets you receive up to €3,000 a year from any one person, tax-free, and it doesn't count against your lifetime threshold at all. The "any one person" part is what makes it powerful: two parents can each give €3,000 to the same child every year, indefinitely, entirely outside the CAT system.
Two reliefs that regularly wipe out a bill altogether, and which the short version of this topic never mentions:
Dwelling House Exemption. Where you inherit a house you'd been living in as your only or main home, had no interest in another property, and continue to live there, the house can pass free of CAT entirely. The conditions are specific and unforgiving — this is one to check against the facts rather than assume.
Agricultural Relief and Business Relief. Both can reduce the taxable value of qualifying farmland or business assets by up to 90%. A €1m farm valued at €100,000 for CAT purposes is a completely different conversation from a €1m farm valued at €1m. Both come with conditions, including ongoing ones after you inherit.
If any of these are in play, the difference between getting them and missing them is usually far larger than the cost of checking. The wider residence and reporting picture is in the complete guide.
When you have to file, even if you owe nothing
If the total taxable value of what you've received in a group exceeds 80% of your threshold, you must file a CAT return — Form IT38, online through ROS — even if the final bill is zero.
That's €320,000 for Group A, €32,000 for Group B, €16,000 for Group C. And the 80% test applies to your aggregated total since 5 December 1991, not just the current benefit.
There's a second trigger too: if you're claiming agricultural relief or business relief, you must file regardless of the amount involved.
The principle is the same one that catches people out with capital gains — the obligation to file is separate from the obligation to pay, and it doesn't disappear just because no tax is due. We cover the equivalent trap on the CGT side in capital gains tax in Ireland.
The deadline
This is where the most expensive mistakes happen, because there isn't one deadline — there are two, and which applies depends on your valuation date.
| Valuation date falls | Pay and file by |
|---|---|
| 1 January – 31 August | 31 October of that same year |
| 1 September – 31 December | 31 October of the following year |
Eight months of the year fall into the first row. If you inherit in March and assume you have until October of next year, you're roughly twelve months late, with a surcharge and interest attached.
Where the return is filed and the payment made through ROS, the deadline for valuation dates in the year ended 31 August 2026 extends to 18 November 2026. Both have to go through ROS to qualify.
What is the valuation date? For a gift, it's usually the date of the transfer. For an inheritance it's more involved — typically around the grant of probate or when the estate is ready for distribution, rather than the date of death. Getting it wrong shifts your entire deadline. Revenue sets it out on its important dates for CAT page.
If there's property, a business, prior gifts, or a cross-border element in the mix, this is the point to get it looked at rather than worked out from an article — our VIP Premium service covers exactly this kind of position.
Why this catches expats specifically off guard
If you've moved from a country where inheritance tax is paid by the estate — or doesn't exist at all — it's easy to assume Irish rules work the same way. They don't, in three ways: the tax is yours, the allowance is a lifetime one, and you have to file it yourself.
The bigger surprise is scope. CAT can apply to inheritances from outside Ireland. Broadly, it comes into charge where the disponer is Irish resident or ordinarily resident, or where the beneficiary is, or where the property itself is in Ireland. So money left to you by a relative who never set foot in Ireland can still be within the Irish net if you're tax resident here. This comes up most often with families who emigrated a decade or more ago and now have ageing parents abroad — we look at that specific situation in tax refunds for Polish workers in Ireland.
And ordinary residence lingers. Once you've been Irish tax resident for three consecutive years you become ordinarily resident, and that status continues until you've been non-resident for three consecutive years. An inheritance received two years after leaving Ireland can still be in scope. The residence rules are set out in moving to Ireland: how cross-border taxes work.
Questions we get asked
I inherited from my parents abroad. Do I have to declare it in Ireland?
Possibly. If you're Irish tax resident or ordinarily resident, a foreign inheritance can be within the Irish CAT net even though the disponer had no Irish connection at all. Where the other country also taxes it, relief for double taxation may be available — but that has to be claimed, and it needs the foreign tax documentation.
Do I have to sell the house to pay the tax?
Not necessarily. Where the inheritance consists of property, there are instalment arrangements that can allow the tax to be paid over a period rather than in one payment, subject to conditions and interest. Check whether the Dwelling House Exemption applies first — if it does, the question may not arise.
My father gave me €10,000. Is that taxable?
The first €3,000 from him in that year falls under the Small Gift Exemption and is ignored entirely. The remaining €7,000 goes against your Group A lifetime threshold. No tax is due unless your cumulative Group A total exceeds €400,000, but the €7,000 has now permanently used part of that allowance — and you need to remember it decades from now.
I have no idea what I received twenty years ago. What do I do?
This is genuinely common, and "I couldn't remember" isn't a defence. Start with what's documented: bank records, solicitors' files from any estate you were part of, and family members with better records than yours. Reconstruct in good faith and keep a note of the basis. Going forward, keep a running record of every gift and inheritance you receive — your future self is the one who needs it.
Does the €3,000 small gift exemption reset every year?
Yes, and it's per disponer. You can receive €3,000 from each of several people in the same year, all outside the CAT system, and again the following year. It doesn't carry forward if unused.