Capital Acquisitions Tax Consolidation Act 2003 section 79

Exemption of certain inheritances taken by parents

Section 79 provides an exemption from inheritance tax where a parent inherits from a deceased child, provided that child had received a non-exempt gift or inheritance from either or both parents within the five years before the child's death.

• An inheritance taken by a parent from their deceased child may be fully exempt from capital acquisitions tax.
• The exemption applies only where the date of the inheritance is the date of death of the child (i.e. the parent takes the inheritance on the child's death).
• To qualify, the deceased child must have received a non-exempt gift or inheritance from either or both of their parents within the five-year period immediately before the child's death.
• Where the exemption applies, the inheritance is also excluded when computing tax on other benefits — it is not aggregated with other taxable gifts or inheritances.