Capital acquisitions tax (CAT) is the broad term covering gift tax and inheritance tax. Inheritance tax arises on the value of property passing to someone on the death of another person. Gift tax arises on the value of gifts received from a living person.
Any house or garden in the State which appears to the Revenue Commissioners to be of national scientific, historic or artistic interest is exempt from CAT.
This can be of huge benefit if you happen to be the beneficiary of one of these heritage houses and gardens with a potential inheritance tax liability.
There are certain conditions necessary for the relief to apply, such as:
In the above context “reasonable access” means access to the house or gardens must be available for a minimum of 60 days in any year, of which 40 days must be in the months of May to September inclusive (subject to reasonable temporary closure for necessary repairs, maintenance or restoration).
Dear Money Mentor
I have just inherited a historic building and garden with tea rooms attached from my elderly uncle, and would like to know if I will be liable for inheritance tax on this property. I am in the process of having it valued, but I am wondering is there any tax reliefs I might be able to avail of. It was a surprise as I didn’t expect to inherit anything. I do not live in the same county as the property.
You should first check if this is an approved property by Revenue, as it appears from your email there are facilities that may have been available to the public. The approval status applies to a property or gardens, not to the owner. If this is the case you may be exempt from any CAT.
To avail of the CAT relief the approved property must form part of the gift or inheritance at the date of the gift or inheritance and the valuation date. To claim heritage property exemption, you must complete a Form IT38 online at revenue.ie
The CAT exemption will cease to apply if:
In the event of clawback of the exemption you must file an amended Form IT38 online with revenue.ie to remove the exemption you claimed.
I would advise you to get professional legal and tax advice once you receive the valuation, as there may be other tax reliefs available to you, such as Section 248 tax relief.
The Irish Heritage Trust (IHT) is an independent not-for-profit trust, established in 2006, supported by the Department of Housing, Local Government & Heritage. It cares for and brings to life a variety of historic houses, gardens and parklands. It has developed innovative visitor experiences bringing benefits to local communities and businesses through tourism and employment. It also promotes a successful volunteering programme. The objective is to share these beautiful properties and ensure they thrive for future generations. This trust comes under the remit of the Department of Housing, Local Government and Heritage and is a registered charity. The properties currently under its care are: Fota House and Gardens, Cork, Strokestown Park, Co Roscommon, National Famine Museum, Co Roscommon, and Johnstown Castle Estate, Museum and Gardens, Co Wexford.
Anyone can become a member of the Irish Heritage Trust. You can support their work by visiting the properties, donating, by volunteering in many different ways, such as tour guiding, helping out at events or gardening, photography and blogging.
Section 482 tax relief is available to owners/occupiers of an approved building (including surrounding garden), or an approved garden existing independently, for costs incurred in its repairs, maintenance or restoration.
To qualify for this relief, and to be designated “approved”, a property is assessed by the Department of Culture, Heritage and An Gaeltacht under specific criteria, such as architectural, aesthetic, scientific and historical. Garden applications are also assessed by the above criteria but must also be deemed horticultural. The Revenue Commissioners approve buildings and/or gardens that can be easily accessed by the public or provide tourist accommodation.
Applying for S482 tax relief
You can apply to have a building and/or garden approved for S482 tax relief by completing either the buildings application form or gardens application form on gov.ie. You will also find a list of all the approved S482 heritage properties and/or gardens open to the public in 2020 there.
There are restriction limits for this relief with regard to high income earners (income greater than or equal to €125,000). Tax relief is not available in respect of expenditure recoverable through grants. Properties do not need to be listed on the Record of Protected Structures (RPS) to be considered, but they do need to be deemed as an “approved building” or as “approved gardens”.