Capital Acquisitions Tax Consolidation Act 2003 section 32

Dealings with future interests

Section 32 deals with the tax treatment where a person who holds a future interest in property (a remainderman) disposes of that interest before it comes into possession, so that when the interest eventually falls in, it is taken by a different person (the transferee).

• Where a remainderman disposes of a future interest before it becomes an interest in possession, the remainderman is treated as having become beneficially entitled in possession to the full extent of that interest at the time it comes into possession.
• The transferee (the person who actually takes the benefit) is primarily accountable for paying the tax, even though the charge is computed by reference to the remainderman's entitlement under the original disposition.
• The charge under this section does not prevent a separate charge to tax arising on the same property under any other disposition — for example, a charge on the gift from the remainderman to the transferee.
• Where more than one charge arises on the same property on the same event, section 105 allows the tax on the event earlier in priority to be credited against the tax on the event later in priority, thereby relieving the double charge.