Inheritance Tax in Ireland: How Much Can You Inherit Tax-Free?

If you inherit money, investments, land or a house in Ireland, the tax people usually mean by inheritance tax is Capital Acquisitions Tax (CAT).

If you are planning your own estate rather than dealing with an inheritance you have received, start with How to Make a Will in Ireland and then use this guide for the tax consequences. If no valid will exists, What Happens If You Die Without a Will in Ireland? explains the statutory inheritance order.

The headline numbers are simple. The calculation often is not.

For gifts and inheritances taken on or after 7 October 2026, the tax-free group thresholds are €420,000 for Group A, €44,000 for Group B and €22,000 for Group C. CAT is generally charged at 33% on the taxable amount above the unused threshold.

The part that catches people is that the threshold is cumulative. It is not a fresh allowance for every inheritance. Relevant earlier taxable gifts and inheritances in the same group since 5 December 1991 can use up part of it.

This guide was updated on 7 October 2026 for the Budget 2027 CAT threshold changes. Revenue guidance is used for the underlying CAT, aggregation, exemption and filing rules. Tax law can change, so use this as general information rather than a substitute for advice on a particular estate.

Inheritance tax in Ireland at a glance

What changed in Budget 2027?

Budget 2027 increased all three CAT group thresholds for gifts and inheritances taken on or after 7 October 2026:

The CAT rate itself did not change and remains 33%. The date of the gift or inheritance determines which threshold applies, so the older €400,000 / €40,000 / €20,000 thresholds remain relevant to benefits taken before 7 October 2026.

The practical saving from the higher threshold can be meaningful. For example, a child inheriting €550,000 with the full Group A threshold available would have paid €49,500 under the previous €400,000 threshold. Under the new €420,000 threshold, the simplified CAT bill is €42,900 — a €6,600 reduction.

The current CAT rate is 33%.

That means a simplified CAT calculation is:

CAT = 33% × the part of the current taxable benefit that exceeds your remaining group threshold.

The relationship rules contain exceptions, so do not select a group only from a family-tree label. Revenue’s CAT groups guidance should be checked where the relationship is unusual.

What is Capital Acquisitions Tax?

CAT is charged on certain gifts and inheritances received by a beneficiary.

The person giving or leaving the benefit is known as the disponer. The person receiving it is the beneficiary.

For inheritance-tax planning, four questions usually decide the result:

1. What is the taxable value of the inheritance?
2. Which CAT group applies to the relationship?
3. How much of that group threshold has already been used by earlier taxable gifts or inheritances?
4. Does an exemption, relief or credit change the taxable value?

Only after those questions are answered does the 33% rate become useful.

How much can you inherit tax-free from your parents?

For the ordinary parent-to-child inheritance, Group A applies.

The current Group A threshold is €420,000.

That does not mean every parent can leave every child €420,000 tax-free independently of previous benefits. The threshold is applied to the beneficiary’s aggregated taxable benefits within Group A.

Example: child inherits €550,000 from a parent

Assume:

• inheritance: €550,000
• earlier Group A taxable benefits: €0
• available Group A threshold: €420,000
• taxable excess: €130,000
• CAT rate: 33%

Estimated CAT: €42,900.

The beneficiary keeps the benefit subject to the tax due and any other estate costs or liabilities relevant to the particular assets.

Example: €100,000 of the threshold was already used

Suppose the child previously received €100,000 of taxable Group A benefits and later inherits €350,000 from a parent.

The remaining threshold is only:

€420,000 − €100,000 = €320,000.

The current €350,000 inheritance therefore exceeds the remaining threshold by €30,000.

Estimated CAT: €9,900.

This is why earlier gifts matter even if no CAT was payable when those gifts were received.

The rule people miss: previous gifts and inheritances are added together

Revenue requires relevant taxable benefits in the same group threshold received on or after 5 December 1991 to be aggregated.

So the question is not simply:

“Is this inheritance below €420,000?”

It is:

“After adding the relevant earlier taxable Group A benefits, how much of my €420,000 threshold is still unused?”

The same principle applies to Groups B and C.

For example, if a beneficiary has already used €390,000 of Group A, only €30,000 of the current €420,000 threshold remains. A later €40,000 taxable benefit would leave €10,000 exposed to CAT.

This aggregation rule is central to both inheritance planning and lifetime gifting.

If you are building assets for children during your lifetime, our guide to saving for your child in Ireland explains why ownership and the timing of a genuine gift matter.

Group A, Group B and Group C explained

Group A — €420,000

Group A most commonly covers a child receiving a gift or inheritance from a parent.

Revenue also includes adopted children and stepchildren within the definition of child. There are additional Group A situations, including certain foster-child cases, certain minor descendants of a deceased child, and a parent taking an absolute inheritance from a child.

Group B — €44,000

Group B generally includes:

• a brother or sister;
• a niece or nephew;
• a parent receiving a gift or limited interest from a child;
• a grandparent;
• a grandchild, except where a specific Group A rule applies.

Group C — €22,000

Group C applies where the relationship is not covered by Group A or Group B.

Revenue lists examples including many:

• cousins;
• friends;
• in-laws;
• uncles and aunts receiving from a nephew or niece.

Direction matters. A niece or nephew inheriting from an aunt or uncle is normally Group B, while an aunt or uncle inheriting from a niece or nephew can fall into Group C.

Worked examples: what CAT could look like

The examples below ignore special reliefs and assume the stated threshold is fully available.

The last example is important: no CAT is due, but a filing obligation can still arise.

A €350,000 Group A inheritance is more than 80% of the €420,000 threshold. In the ordinary case that means an IT38 return must be filed, even though the inheritance remains below the threshold and no CAT is payable.

What if you inherit a house?

A house is not automatically tax-free because it was the deceased person’s home.

In a straightforward case, the house is valued for CAT and the beneficiary’s available threshold is applied in the same way as for other property.

Example: child inherits a €500,000 house

Assume a parent leaves a house with a taxable value of €500,000 to an adult child, the child has no earlier Group A benefits, and no special exemption or relief applies.

• taxable value: €500,000
• Group A threshold: €420,000
• taxable excess: €80,000
• CAT at 33%: €26,400

That is a simplified example. The actual taxable value is not always the headline property value.

Revenue states that the taxable value is based on market value on the valuation date, less allowable liabilities, costs or expenses and any consideration paid, subject to the relevant rules.

Can a house be exempt from inheritance tax?

Potentially, through the Dwelling House Exemption — but the conditions are deliberately strict.

For an inheritance after 25 December 2016, Revenue’s main conditions include that:

• the house was the deceased person’s only or main home at the date of death, subject to stated exceptions;
• the beneficiary lived in it as their only or main home for the three years immediately before the inheritance;
• the beneficiary does not own, or have an interest in, another house at the date of inheritance;
• the beneficiary does not acquire an interest in another house from the same disponer between the inheritance date and valuation date;
• the house continues to be the beneficiary’s only or main home for six years after the inheritance, unless an exception applies.

There are exceptions around age, employment and physical or mental infirmity.

This is not a general “family home exemption”. Check Revenue’s Dwelling House Exemption conditions against the exact facts.

Are inheritances between spouses taxed?

A gift or inheritance from a spouse or civil partner is exempt from CAT.

That is different from the Group A/B/C thresholds: the spouse or civil-partner exemption means the qualifying transfer itself is exempt rather than merely using a larger threshold.

Revenue also has specific rules for certain transfers involving qualified cohabitants, but ordinary cohabitation should not be assumed to create the spouse or civil-partner exemption.

Does the €3,000 Small Gift Exemption reduce inheritance tax?

Usually, no.

The Small Gift Exemption applies to gifts, not ordinary inheritances.

A person can currently receive up to €3,000 in gifts from each disponer in a calendar year without that exempt amount being charged to CAT or counted in later aggregation.

For example, two parents can each give a child €3,000 in the same year — €6,000 in total — without using the child’s Group A threshold, provided the gifts qualify.

But you cannot take an inheritance after a death and simply deduct another €3,000 from it because the annual gift exemption was unused.

For families building wealth over many years, that distinction is important. The exemption can form part of a genuine lifetime gifting strategy, but it is not a last-minute inheritance allowance.

For the lifetime-transfer side in detail — including gifts from parents, house deposits, grandparents, family loans and worked examples — read Gift Tax in Ireland 2027.

What is the taxable value of an inheritance?

Revenue distinguishes between market value and taxable value.

Broadly, taxable value starts with the market value of the gift or inheritance on the valuation date and can be reduced by allowable liabilities, costs or expenses and by consideration paid.

For an estate, the personal representative may need to deal with items such as:

• funeral expenses;
• pre-death tax liabilities;
• other pre-death liabilities such as a mortgage or overdraft;
• administration costs;
• legal costs;
• certain tax liabilities arising during administration.

Exactly which deductions attach to a beneficiary’s taxable benefit can depend on the asset and estate, so this is an area where a solicitor or tax adviser may be needed for a large estate.

Date of death and valuation date are not always the same

This is another common source of confusion.

For an inheritance, the date of inheritance is usually the date of death. That date generally determines the CAT threshold and rate that apply.

The valuation date determines when the property is valued for CAT and which pay-and-file period applies.

Revenue says the valuation date for an inheritance can be the earliest date on which the executor or administrator is entitled to retain the asset for the beneficiary, actually retains it, or gives it to the beneficiary.

So a person can die in one tax period while the valuation date — and therefore the payment deadline — arises later.

When do you have to file an IT38?

Revenue’s general rule is that you must file an IT38 CAT return when the total taxable value of benefits taken exceeds 80% of the relevant group threshold.

Using today’s thresholds, the numerical markers are:

• Group A: €336,000
• Group B: €35,200
• Group C: €17,600

That does not mean tax becomes payable at 80%. It means a return can be required before the full tax-free threshold has been used.

Example: filing with no CAT bill

A child receives a €350,000 inheritance from a parent and has no earlier Group A benefits.

The amount is below the €420,000 threshold, so there is no CAT on this simplified example.

But €350,000 exceeds the €336,000 filing marker.

An IT38 filing obligation therefore arises even though the estimated CAT is €0.

Revenue also requires a CAT return where Agricultural Relief or Business Relief is claimed, even if the normal 80% filing test is not exceeded.

When is inheritance tax due?

The pay-and-file deadline depends on the valuation date.

Revenue’s current rule is:

• valuation date from 1 January to 31 August → pay and file by 31 October of that year;
• valuation date from 1 September to 31 December → pay and file by 31 October of the following year.

Revenue may announce an extended online ROS deadline for a particular year. The statutory timing should be checked for the relevant filing period rather than assumed from a previous year.

Returns can generally be filed through myAccount or ROS.

Agricultural Relief: why farm inheritances can be different

Agricultural Relief can be extremely significant.

Where the conditions are satisfied, Revenue says the relief reduces the taxable value of qualifying agricultural property by 90%.

It is not enough simply to inherit farmland.

Current conditions include, among other things:

• the assets must constitute agricultural property at the relevant dates;
• the beneficiary must satisfy the 80% agricultural property asset test on the valuation date;
• the beneficiary, or a qualifying lessee where the property is leased, must satisfy the active farmer requirements for six years.

Relief can also be withdrawn in some circumstances.

Because the numbers involved in farms can be large, eligibility should be checked before relying on the 90% reduction.

Business Relief

Business Relief can also reduce the taxable value of qualifying business property by 90%, subject to conditions.

Revenue says it can apply to qualifying transfers of:

• a business;
• a share in a business;
• shares or securities in a company carrying on a business.

It does not mean every asset associated with a business automatically qualifies.

There are rules around relevant business property, ownership periods, excepted assets and clawbacks. A business succession should therefore be modelled using the actual company or trade structure rather than a simple percentage assumption.

Favourite Nephew or Niece Relief

A niece or nephew would normally be in Group B when receiving from an aunt or uncle.

However, Favourite Nephew or Niece Relief can allow the Group A threshold to apply to qualifying business assets where Revenue’s conditions are met.

One of the key conditions is a work requirement during the five years immediately before the gift or inheritance, with minimum weekly hours set by Revenue depending on the business circumstances.

It applies to qualifying business assets, not automatically to every asset inherited from an aunt or uncle.

Can you legally reduce future inheritance tax?

There is no single inheritance-tax strategy that suits every family, but several lawful planning issues are worth understanding early.

1. Keep a record of previous taxable benefits

The biggest practical mistake is often not knowing how much of a threshold has already been used.

Keep records of significant gifts and inheritances, the disponer, the relationship group and the taxable value used for CAT.

2. Understand lifetime gifting

The annual €3,000 Small Gift Exemption can allow genuine gifts to pass without using the recipient’s group threshold.

But gifting assets can have consequences for the person making the gift too, including possible Capital Gains Tax depending on the asset.

Do not look only at CAT.

3. Do not confuse control with ownership

Putting money aside “for a child” is not necessarily the same thing as making a completed gift to the child.

Our saving for your child in Ireland guide explains the distinction between parent-owned assets, child-owned assets, bare trusts and other arrangements.

4. Review wills and asset ownership

Who legally owns a property, bank account, investment or business interest can affect what passes through an estate and how.

Estate planning is therefore wider than the CAT calculation. If you are dealing with an estate after a death, Probate in Ireland: Complete Guide explains the grant process, SA.2, fees and current timelines.

5. Check reliefs before a transfer happens

Agricultural Relief, Business Relief and Dwelling House Exemption have detailed conditions. Planning after a condition has already been broken may be too late.

A practical inheritance-tax checklist

When someone expects to receive an inheritance, work through these questions:

1. What am I receiving? Cash, investments, property, land, business assets or a mixture?
2. What is its taxable value? Use the correct valuation date and allowable deductions.
3. Who is the disponer? The relationship determines the CAT group.
4. What earlier taxable benefits have I received in that group since 5 December 1991?
5. How much of the group threshold remains?
6. Does an exemption or relief apply?
7. Does the 80% IT38 filing rule apply even if no tax is due?
8. What is the pay-and-file deadline for the valuation date?
9. Are there separate CGT, probate, legal or succession issues?

Then use the Inheritance & Gift Tax Calculator for a first-pass estimate.

Frequently asked questions

What are the inheritance tax thresholds in Ireland for 2027?

For gifts and inheritances taken on or after 7 October 2026, the CAT thresholds are €420,000 for Group A, €44,000 for Group B and €22,000 for Group C. The standard CAT rate remains 33%.

Did Budget 2027 abolish inheritance tax?

No. Budget 2027 increased the three tax-free thresholds but did not abolish CAT. Tax can still arise at 33% on the part of a taxable gift or inheritance above the beneficiary’s remaining threshold, subject to exemptions and reliefs.

How much can a child inherit tax-free in Ireland?

Under the current Group A threshold, a child can generally receive up to €420,000 in aggregated taxable Group A benefits before CAT is due, assuming the full threshold is still available.

What is the inheritance tax rate in Ireland?

The current CAT rate is 33% on the taxable amount above the available threshold.

Is the €420,000 threshold per parent?

Do not treat it as a separate €420,000 allowance from each parent.

The Group A threshold applies to the beneficiary’s aggregated taxable Group A benefits. Gifts and inheritances from both parents can therefore use the same Group A threshold.

Can I inherit €420,000 from my mother and another €420,000 from my father tax-free?

Not under the normal aggregation rules if both benefits are Group A and fall within the aggregation period. The current €420,000 Group A threshold is applied to the accumulated taxable benefits in that group, not separately to each parent.

Is inheritance tax based on the value of the whole estate?

CAT is concerned with the taxable benefit received by each beneficiary, not simply the gross size of the deceased person’s estate.

Different beneficiaries can have different CAT groups, previous benefits and reliefs.

Do I pay CAT when my spouse dies?

A qualifying inheritance from a spouse or civil partner is exempt from CAT.

Do I automatically pay tax if I inherit a house?

No. The result depends on the taxable value, your available group threshold and whether an exemption such as Dwelling House Exemption applies.

Is the family home always exempt?

No. Dwelling House Exemption has detailed occupation, ownership and continued-residence conditions. It should not be assumed merely because the property was a family home.

Is a grandchild Group A?

Not normally just because they are a grandchild. Most grandchild benefits fall into Group B, although Revenue has specific Group A rules for certain minor children of a deceased child.

Is a niece or nephew Group B?

A niece or nephew receiving from an aunt or uncle is generally Group B. Favourite Nephew or Niece Relief can change the threshold for qualifying business assets where its conditions are met.

Do I need to file if no inheritance tax is due?

Possibly. Under Revenue’s general rule, an IT38 is required once accumulated taxable benefits exceed 80% of the relevant threshold. Claims for Agricultural Relief or Business Relief can also require a return.

Does the €3,000 annual gift exemption apply to inheritances?

The Small Gift Exemption applies to gifts, not ordinary inheritances.

Can inheritance tax rules change in a Budget?

Yes. CAT thresholds, rates and reliefs are set by law and can change. This guide was updated on 7 October 2026 for the Budget 2027 threshold changes, while Revenue guidance is used for the underlying CAT rules.

The bottom line

For most people, Irish inheritance tax comes down to three numbers:

the taxable value of what you receive, the threshold available for your relationship group, and how much of that threshold you have already used.

For benefits taken on or after 7 October 2026, the current thresholds are €420,000, €44,000 and €22,000, with CAT generally charged at 33% above the available threshold.

But the simple headline can hide the issues that matter most: previous gifts, the valuation date, an IT38 filing obligation before tax is due, and reliefs for homes, farms and businesses.

Start with the numbers using the Inheritance & Gift Tax Calculator, then verify any material estate or relief claim against Revenue’s current guidance before acting.