Taxes Consolidation Act 1997 section 599

Disposals within family of business or farm

Section 599 provides relief from capital gains tax where an individual aged 55 or over disposes of qualifying assets to a child, as specially defined, and sets out the monetary limits, aggregation rules, clawback provisions and deferral option that apply to such disposals.

• Full CGT relief applies on disposals of qualifying assets to a child, subject to monetary caps that vary by the date of disposal and the age of the individual: for disposals on or after 1 January 2025, a €10 million lifetime limit applies for individuals aged 55 to 69, and a €3 million limit applies for individuals aged 70 or over.
• "Child" is extended to include a grandchild (child of a deceased child), a nephew or niece who has worked substantially full-time in the business for the five years ending on the disposal date, and a foster child maintained by the individual for at least five years before reaching age 18.
• If the child disposes of the transferred assets within six years, the CGT that would have been charged on the parent is clawed back and assessed on the child; for disposals on or after 1 January 2025 where the value exceeds €10 million, the CGT on the excess may be deferred and falls away entirely if the child retains the assets for 12 years.
• The relief must be formally claimed in the individual's tax return for the year of assessment in which the disposal takes place, and it applies only where the disposal is made for bona fide commercial reasons and does not form part of a tax avoidance arrangement.