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Finance Act changes to CAT & Gifts to Children

The exemption is now restricted to the provision, in the lifetime of the disponer, of support, maintenance or education to

- a minor child, or
- a child up to age 25 who is in full-time education, or
- regardless of age, who is permanently incapacitated.

While the amendment reflects a change to the exemption, the life-time threshold values remain the same at €225,000 from Parent to Child and the annual gift exemption of €3,000 will still apply. Non-exempt gifts would include the purchase of a house by a parent for a child, free use of a house where a child is living in it rent free, a gift of a House Deposit in excess of the €3,000 annual exemption and gifts of money. However, example of gifts that Revenue would be considered as exempt would include occupation of a family home by a child, free use of a house by a child attending university, cost of family functions paid by a parent (weddings but not honeymoons) and payments to cover child’s normal costs associated with attending college.

Further details are available from Revenue’s website http://www.revenue.ie/en/practitioner/ebrief/archive/2014/no-1092014.html