Capital Gains Tax

If you own an asset, disposing of it means:

• Selling it
• Giving it as a gift
• Exchanging it
• Getting compensation or insurance for it

If you make a gain (profit) when you dispose of an asset, Capital Gains Tax (CGT) applies to the chargeable gain.

The chargeable gain is usually the difference between the price you paid for the asset and the price you get when you dispose of it. When you calculate CGT, you can deduct some expenses, such as the cost of getting and disposing of the asset.

When you dispose of an asset, you must:

• Pay CGT by 15 December of the same year (if the disposal is in December, the deadline is 31 January)
• File a tax return for CGT by 31 October of the following year

The first €1,270 of chargeable gains in a tax year are exempt from CGT.

If you have a spouse, this exemption is available to each of you, but it cannot be transferred between you. Civil partners are treated in the same way as spouses.

The main exemptions from CGT include:

• Your home (Principal Private Residence Relief)
• Assets you get from your spouse
• A site you get from your parent
• Business or farm assets if you are 55 or older
• Assets passed on when you die

Principal Private Residence Relief

You may be exempt from CGT if you dispose of a property that you:

• Lived in as your only or main residence or
• Provided for free to a widowed parent or an incapacitated relative to use as their only residence

The exemption includes land around the house of up to 1 acre.

Restrictions

You can only claim the relief for:

• The part of the house that you used as your home.
• The value of the property as you currently use it (not for its development potential).
• The time you lived in the property. There are some exceptions, including:
  • The last 12 months of ownership.
  • Time you were absent for work or health reasons.

Revenue has more information and examples of Principal Private Residence Relief and restrictions.

Assets from a spouse

If you transfer an asset to or from your spouse, it is exempt from Capital Gains Tax.

If you are separated from your spouse, the transfer is exempt if it is made under a Separation Agreement or a court order. Read more about capital taxes following separation or divorce.

Site given by a parent

If you transfer land to your child to build their home on it may be exempt from CGT. The land must be less than 1 acre and have a value of €500,000 or less.

Farm or business

If you are over 55 and disposing of business or farm assets, you may be able to get CGT relief. This is called Retirement Relief but you do not have to retire from the business or farm.

The exemption limits depend on your age and whether the disposal is to your child or to someone outside your family.

Revenue has more information about Retirement Relief. There is also more detailed information available for:

• Retirement Relief (pdf)
• Retirement Relief for disposals to your child (pdf)

After a death

There is no Capital Gains Tax on assets that are passed on after a death. Your assets are treated as if the value they had when you got them was the same as the value they had on the date of your death, so there is no chargeable gain.

If a personal representative disposes of the assets, they pay CGT on any gains made between the date of death and the date of disposal.

Other exemptions

Other exemptions from Capital Gains Tax include gains from:

• Betting, lotteries, sweepstakes and prize bonds
• Bonuses payable under the National Instalments Savings Schemes
• Government stocks
• Certain life assurance policies
• Moveable property, if the gain is €2,540 or less
• Animals
• Private motor cars
• Property acquired between 7 December 2011 and 31 December 2014

Revenue has further information on reliefs from Capital Gain Tax.

CGT is charged on the difference between the sale price and the amount you paid. However, allowable expenses can be deducted from the sale price.

Allowable expenses include:

• Money you spend that adds value to the asset
• Your costs to get and dispose of the asset (for example, solicitor fees)

The chargeable gain is the difference between:

• The amount you paid for the asset and
• The amount you get for it (the sale price) after deducting allowable expenses

If you owned the asset before 2003, indexation relief can increase the purchase price that is taken into account.

To get the amount that is taxable, you can deduct the following from the chargeable gain:

• Your personal exemption of €1,270
• Any other exemptions or reliefs you are entitled to
• Allowable losses

Rate of tax

The standard rate of Capital Gains Tax is 33% of the taxable gain you make.

A rate of 40% can apply to certain foreign life policies and investment products.

Market value

In some cases, you will need to use the market value to calculate GCT, for example, if a sale price or cost price does not apply.

You will need to use the market value, instead of the sale price, to calculate CGT if you dispose of the asset:

• As a gift
• At less than it was worth, to help the buyer
• After inheriting it

The deadline to pay CGT depends on the date of disposal.

You must also make a tax return by 31 October in the following tax year.

Pay online

You must register for CGT and then pay online using Revenue Online Service (ROS) or myAccount.

To register for CGT:

• If you have a tax registration number, send a request through MyEnquiries.
• If you have never been registered for tax, complete Form TR1 (pdf). If you are non-resident, use Form TR1 FT (pdf) instead.

If you cannot pay online

If you have an exemption from the requirement to file online, you can:

• Email the Payment Accounting section of the Collector-General’s Division or
• Send your payment with CGT Payslip A (pdf). (If the disposal was in December, use CGT Payslip B (pdf) instead.)

You must file a tax return for all disposals, even if there is no tax due.

When you dispose of an asset, you must file a return by 31 October of the following year.

For example, if you dispose of an asset between 1 January and 30 November, payment is due by 15 December. Your return will be due by 31 October of the next year.

You can use ROS to file your Income Tax Return (Form 11) or Form 1.

You can post the Form CG1 or paper Income Tax Return (Form 12) to your Revenue office.

Capital Gains Tax can be more complex than the examples above. For this reason, you should get advice.

Revenue provides further information on Capital Gains Tax.