Inheritance Tax Ireland: CAT, IT38 & Thresholds

If you have been left something in a will — or you stand to inherit because someone died without one — the first question is usually whether you owe tax on it. In Ireland the answer comes down to one tax, CAT, and one form, the IT38. This guide explains both in plain English, so you can work out where you stand before you talk to anyone. For the wider context of how an estate is administered, see our guide to what probate is and how it works.

Most of the figures here changed in Budget 2025. The thresholds below apply to gifts and inheritances taken on or after 2 October 2024, and every money figure on this page has been checked against Revenue.ie at the date shown in the byline above. Tax law changes with each Finance Act, so always confirm the current position before you file.

How much can you inherit tax-free? The three CAT groups

The amount you can inherit tax-free depends entirely on your relationship to the person who died — Revenue uses the term “disponer” for that person. Everyone falls into one of three groups, and each group has a single lifetime threshold. Once your total benefits within a group pass that threshold, CAT at 33% applies to everything above it.

These are lifetime thresholds, not annual allowances. The €400,000 a child can receive, for example, is the total they can inherit from both parents across their whole life before any CAT applies — not €400,000 per inheritance and not €400,000 per parent. Once the running total is used up, the next euro is taxed.

The 80% rule: when you'll need to file an IT38

Here is the part that surprises most people: you can be obliged to file an IT38 even when you owe no tax at all. The trigger is not the threshold itself — it is 80% of it. Once the total taxable value of the gifts and inheritances you have received in a group exceeds 80% of that group's threshold, you'll need to file an IT38 return with Revenue.

So a child who inherits €330,000 owes no CAT, because they are well under the €400,000 Group A threshold — but they have passed €320,000 (80% of the threshold) and will still need to file an IT38. The return exists so Revenue can see how much of your lifetime threshold you have used up, not only to collect tax.

Adding it all up: aggregation since 1991

Your threshold is not refreshed with each new inheritance. When you work out whether you have crossed it, you'll need to add together every taxable gift and inheritance you have received within the same group since 5 December 1991. This is called aggregation, and it is why a modest inheritance can still create a tax bill if you received benefits years earlier.

Aggregation applies group by group. A gift from a parent (Group A) is not added to an inheritance from an uncle (Group B) — each group keeps its own running total against its own threshold. But two separate inheritances from different aunts both count against the single Group B threshold of €40,000.

One amount is carved out of all of this: the small-gift exemption. The first €3,000 you receive from any one person in a calendar year is exempt from CAT entirely. It is not taxed and — importantly — it is not counted for aggregation, so it never eats into your threshold. This exemption applies to gifts only, not to inheritances received on death.

The spouse and civil-partner exemption

If you inherit from your spouse or civil partner, the thresholds above are irrelevant: a gift or inheritance received from a spouse or civil partner is exempt from CAT. There is no group, no threshold, and no return to file on the value passing between spouses — it is simply outside the charge.

This is a tax exemption, not a guarantee of who inherits. Whether a surviving spouse actually receives the estate depends on the will or, if there is no will, on the rules of intestate succession, which give a spouse a legal entitlement that the CAT exemption then sits on top of. The exemption settles the tax question; succession law settles the ownership question.

What the IT38 actually is — and who files it

The IT38 is Revenue's self-assessment return for CAT. Crucially, it is filed by the beneficiary — the person who receives the gift or inheritance — not by the executor or administrator of the estate. The executor's duties cover gathering and distributing the estate; the tax return on what you personally receive is yours to file.

There are three ways to file. Most individuals use myAccount, Revenue's online service; agents and the self-assessed use ROS; and a shortened paper form, the IT38S, is available — but only if all three conditions are met: no reliefs are claimed other than the small-gift exemption, the benefit has no conditions or restrictions, and the property is from one person only and is not part of a larger benefit. The online channels calculate the tax for you, while the paper IT38S requires you to do the sum yourself.

The amount you declare depends on the value of the assets at the valuation date. For an inheritance, Revenue defines this as the earliest of three dates: the date the executor or administrator is entitled to retain the asset for your benefit, the date it is actually retained, or the date it is given to you. In practice that often falls on or around the grant of probate or letters of administration — but it can be earlier (for example, a cash legacy paid before the grant) or later, so it is worth confirming rather than assuming. You can check whether a grant has issued — and read the published estate values — by searching the probate register.

Key deadlines: the 31 October rule

CAT has a single pay-and-file date each year — 31 October — but which 31 October you face depends on when your valuation date falls. The valuation date is the date used to value what you receive, and it splits the calendar into two windows.

Missing the deadline triggers a surcharge on the tax due. File within two months of the deadline and the surcharge is 5%, capped at €12,695. File more than two months late and it rises to 10%, capped at €63,485. Interest also accrues on any unpaid CAT from the due date. Establishing your valuation date early is the simplest way to avoid this.

Reliefs that can reduce or remove the bill

Several reliefs can dramatically reduce, or entirely remove, a CAT liability. They are valuable but condition-heavy, and claiming one is often where professional advice earns its keep. The three most commonly relevant to beneficiaries are summarised below.

The dwelling house exemptioncan let an inherited home pass free of CAT. Broadly, you'll need to have lived in the house as your only or main home for the three years before the inheritance, not own or have an interest in any other house, and continue to live there for six years afterwards (the six-year rule is relaxed for those aged 65 or over).

Agricultural relief reduces the taxable value of qualifying farmland by 90%, subject to an asset test and active-farmer conditions. Business relief works in parallel, reducing the taxable value of qualifying business property or family-company shares by 90%. Both are powerful, both have clawback rules, and both reward getting the structure right before you file.

Should you get professional help?

For a single inheritance comfortably under your threshold, an IT38 is a manageable self-assessment return. The picture changes once aggregation, reliefs, foreign assets, or an estate you are also administering come into play. That is where a Chartered Tax Adviser earns their fee — by claiming the right reliefs, avoiding clawbacks, and filing correctly the first time.

If you are not sure which group you fall into, whether you have crossed the 80% mark, or whether a relief applies, it is worth mapping your position before the 31 October deadline rather than after it. Our free assessment can help you identify whether a tax adviser is needed — and if it is, we can introduce you to a specialist tax adviser who handles CAT, IT38 returns, and estate tax planning. If you would prefer to talk through your situation, you can also contact us.