Inheritance tax in Ireland applies to both residents and non-residents, including foreigners and expats, at a standard rate of 33% on amounts above the applicable thresholds.
This affects gifts and inheritances, with rules depending on the recipient’s relationship to the deceased and their tax residency.
This article covers:
- How much can you inherit without paying taxes in Ireland?
- Do non-residents pay inheritance tax?
- Do you have to pay Irish inheritance tax if you live abroad?
Key Takeaways:
- Capital Acquisitions Tax (CAT) is 33% above thresholds for all recipients, including non-residents.
- Children of Irish residents benefit from the highest exemption (€400,000).
- Non-residents are taxed only on Irish-situated assets.
- Using reliefs, exemptions, and lifetime gifts can reduce liabilities for expats.
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The information in this article is for general guidance only. It does not constitute financial, legal, or tax advice, and is not a recommendation or solicitation to invest. Some facts may have changed since the time of writing.
What are the rules for inheritance tax in Ireland?
The rules for inheritance tax in Ireland apply to residents and non-residents alike, with thresholds based on the recipient’s relationship to the deceased.
It is governed by Capital Acquisitions Tax (CAT).
- Group A: Children inheriting from parents
- Group B: Siblings, nieces, nephews, and lineal descendants
- Group C: All other beneficiaries
The standard CAT rate is 33% on the value exceeding the relevant threshold.
Gifts between spouses or civil partners are exempt. Property, cash, shares, and other assets are all subject to CAT unless specifically exempted.
For expats or foreigners, it is crucial to check whether their home country has a double taxation agreement with Ireland, as it may affect how CAT is applied.
What is the inheritance tax in Ireland for non-residents?
Non-residents are liable for CAT only on Irish-situated assets. The same group thresholds and 33% tax rate apply.
The assets include:
- Property in Ireland
- Shares in Irish companies
- Bank accounts or investments held in Ireland
Foreigners inheriting Irish assets should be aware of:
- How CAT interacts with their country of residence
- Double taxation relief opportunities
- The importance of proper documentation and valuations
Planning for non-resident inheritance often involves understanding international tax obligations to avoid surprises.
How much can I inherit before I pay tax in Ireland?
You can typically inherit anywhere from around €20,000 to €400,000 before paying tax in Ireland.
CAT thresholds apply to both residents and non-residents:
- Group A (children from parents): €400,000
- Group B (siblings, nieces/nephews, lineal descendants): €40,000
- Group C (all others): €20,000
Amounts above these thresholds are taxed at 33%.
Exemptions may apply for certain gifts, family homes, or agricultural/business property, which can be especially relevant for expats and non-residents inheriting Irish property or assets.
How do you calculate inheritance tax in Ireland?
Inheritance tax in Ireland is calculated by subtracting the relevant threshold and exemptions from the total value of the inheritance, then applying the 33% CAT rate.
To calculate CAT for residents and non-residents:
- Determine the total value of the inherited assets (Irish-situated for non-residents).
- Subtract applicable thresholds and exemptions.
- Apply the 33% CAT rate to the remaining value.
Example for expats: A foreign child inherits €500,000 from a parent with Irish property. The Group A threshold is €400,000.
The taxable amount is €100,000, resulting in €33,000 of CAT.
Non-residents should ensure asset valuations comply with Irish Revenue requirements, including currency conversions if the inheritance is in a foreign currency.
Who has to pay inheritance tax in Ireland?
Irish inheritance tax applies to anyone who receives assets above the applicable group threshold, whether they are residents, non-residents, or expats.
- Residents are liable on worldwide gifts and inheritances.
- Non-residents are liable only on Irish-situated assets, such as property, shares in Irish companies, or bank accounts in Ireland.
- Spouses and civil partners are generally exempt.
- Children, siblings, and other beneficiaries are subject to CAT based on their relationship group.
Foreigners or expats inheriting Irish assets should be aware of double taxation agreements and ensure proper documentation and valuation to comply with Irish tax laws.
How to avoid inheritance tax in Ireland?
Inheritance tax in Ireland cannot usually be eliminated, but it can be legally reduced through advance estate planning and the proper use of available reliefs and exemptions.
Tax evasion is illegal, while tax avoidance through lawful planning is permitted and widely used by residents and expats alike.
Common strategies include:
1. Lifetime gifts: Making gifts within allowed thresholds, including using the small gift exemption to gradually transfer wealth.
2. Spousal or civil partner exemptions: Assets can pass tax-free between spouses or civil partners.
3. Agricultural and business reliefs: Reduce the taxable value of qualifying farm or business assets, sometimes significantly.
4. Trusts and structured estate planning: Useful for high-value or cross-border estates to manage tax liabilities and succession.
5. Non-resident and expat considerations: Planning must account for foreign tax exposure, reporting requirements, and how Irish CAT interacts with taxes in the beneficiary’s country of residence.
For non-residents and expats, planning must also account for foreign tax exposure, reporting requirements, and how Irish CAT interacts with the tax rules of the country where they live.
Do I have to pay inheritance tax on my parents’ house in Ireland?
You may not have to pay inheritance tax on your parents’ house in Ireland if you qualify for the Dwelling House Exemption, but the conditions are strict.
The exemption may apply if:
- The heir lived in the property for the required period and continues to do so after inheritance
- The property is inherited from a parent or other qualifying relative
For expats, owning or occupying another property abroad can affect eligibility, as the exemption generally requires the inherited home to be the beneficiary’s main residence.
Non-resident heirs may still qualify if all conditions are met, but the assessment and documentation process can be more complex.
What to do first when you inherit money in Ireland?
The first step for residents and expats is to notify the Irish Revenue Commissioners and obtain a professional valuation of the inheritance.
For non-residents, additional considerations include:
- Identifying Irish-situated assets subject to CAT
- Checking double taxation agreements
- Confirming eligibility for reliefs, such as the Dwelling House Exemption for family homes
Proper documentation is essential to ensure correct CAT calculation and compliance with Irish law.
Conclusion
Irish IHT can apply even when you live abroad, making it especially important for expats and non-residents to understand how CAT works in practice.
Thresholds, asset location, and reliefs matter more than residency labels alone.
With Irish property and cross-border estates, early planning and correct reporting are often the difference between an efficient transfer and an unexpected tax bill.
FAQs
How much money can you gift to a family member tax-free in Ireland?
You can gift up to €3,000 per person per year tax-free in Ireland under the Small Gift Exemption, regardless of your relationship.
In addition, larger gifts may also be tax-free up to the recipient’s lifetime CAT group threshold, after which CAT applies at 33%.
How to avoid capital gains tax on inherited property in Ireland?
CGT is based on the increase in value after inheritance, with reliefs such as principal private residence relief or spousal transfers helping to limit the liability.
Capital gains tax does not apply when you inherit property in Ireland, but it may apply when you later sell it.
What expenses can be offset against inheritance tax?
Certain liabilities of the deceased, including outstanding debts and reasonable funeral expenses, can be deducted from the estate before inheritance tax is calculated.
General administration or probate costs are not automatically deductible, unless they are directly incurred to establish or realize the taxable value of the assets.
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