Capital Acquisitions Tax Consolidation Act 2003 section 7

Liability to gift tax in respect of gift taken by joint tenants

Section 7 provides that where a gift is taken by joint tenants, the liability to gift tax is calculated as if the recipients had taken the gift as tenants in common in equal shares.

• Where two or more persons receive a gift as joint tenants, they are treated for gift tax purposes as if they received it as tenants in common in equal shares.
• This means each joint tenant is taxed on an equal fraction of the total value of the gift.
• The rationale is that any joint tenant could become the absolute owner of a share by severing the joint tenancy, so each is treated as having received that share.
• A tenant in common can freely sell their share of jointly held property, whereas a joint tenant cannot sell without the agreement of the other joint tenant(s).