The finance bill published on Thursday by Minister for Finance Paschal Donohoe extends the capital gains tax (CGT) relief available to parents who give a site to their child so that they can include the child's spouse or partner in the transaction.

Existing legislation lets parents give land to their child without paying CGT up to a maximum of one acre and a valuation of €500,000, on the condition that the child builds their principal private residence on the site.

Under current rules, only the child can benefit from the tax-free transfer. If their spouse or partner becomes co-owner of the property, they lose the tax exemption.

From 1 January 2019, the finance bill provides that "‘child’ shall be deemed to include the spouse or civil partner of the child concerned" in such cases. The change will help the many farming families who transfer a piece of land from the parents' farm to a child who builds a home to move into as a couple.

The Oireachtas must now pass the finance bill before the measure becomes law.

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