INHERITANCE TAX THRESHOLDS are to increase across all categories in Budget 2027.<\/p>\n
Inheritance tax, known as Capital Acquisitions Tax (CAT), emerged as a key issue in recent months ahead of the budget<\/a>, with both Fianna F\u00e1il and Fine Gael pledging to review the current system.<\/p>\n Taoiseach Miche\u00e1l Martin and T\u00e1naiste Simon Harris have expressed strong views on the inheritance tax system, dubbing it unfair in recent years.<\/p>\n The tax-free threshold for children inheriting from their parents is to increase by \u20ac20,000.\u00a0<\/p>\n Currently, a child can inherit up to \u20ac400,000 from their parents in their lifetime before a tax of 33% kicks in. Budget 2027 will see this threshold increase by \u20ac20,000 to \u20ac420,000.<\/p>\n There are also increases for inheritances for those less closely related to the deceased.\u00a0<\/p>\n Ahead of today\u2019s budget, both government parties signalled they wanted to address concerns raised by people without children<\/a>, who currently face lower tax-free thresholds when leaving an inheritance to nieces, nephews or other relatives than parents do when passing assets to their children.<\/p>\n The tax-free threshold for Group B, which applies to siblings, nieces, nephews and some relatives, will increase from \u20ac40,000 to \u20ac44,000.<\/p>\n Meanwhile, it will increase from \u20ac20,000 to \u20ac22,000 for group C, which includes non-relatives.\u00a0<\/p>\n Last year a total of \u20ac1,120.5 million was recorded in CAT tax receipts, according to the government\u2019s tax strategy group report<\/a> in June.\u00a0<\/p>\n Inheritance tax has seen significant changes in Ireland following the 2008 financial crisis.<\/p>\n