CAPITAL GAINS TAX LIABILITY

CGT arises on the disposal of certain Irish and overseas assets, usually company shares and land and buildings.

The standard rate of cgt is 33%. . Exceptionally a 40% rate applies on disposals of certain foreign life assurance policies.

Cgt arises on the difference between the sale price and the cost of the asset. The first €1270 gain per year is exempt and the balance is taxable at 33%. If the asset was acquired prior to 2003 an allowance for inflation is granted which effectively increases the cost of the asset for tax purposes.

ASSET VALUATION

Where assets are acquired or disposed of for no actual consideration ……generally as gifts or inheritances……. then often these assets will have to be valued for tax purposes. This may often include shares in private companies. Valuation may have aspects that are contentious and taxpayers may find themselves in dispute with Revenue who may have a different opinion as to their value. Very substantial amounts of tax may be involved depending on what valuation is ultimately agreed upon. There is also an appeals mechanism for dissatisfied taxpayers.

We are experts in advising on valuations for both capital gains tax and capital acquisitions tax purposes.

RETIREMENT RELIEF

A gain on the disposal of a business or farm by an individual aged 55 or over for less than €750,000 is exempt cgt.. There is no limit where the disposal is to a child or niece/nephew that works in the business.