Section 72 life insurance eligibility check
Section 72 CATCA 2003 allows specific life assurance policies to pay inheritance tax (CAT) tax-free. Four conditions determine whether a policy qualifies. This checker walks through each.
How Section 72 works
Section 72 of the Capital Acquisitions Tax Consolidation Act 2003 allows the proceeds of a specially structured life assurance policy to pay CAT without the proceeds themselves counting as a taxable inheritance. The policy must be:
- Explicitly structured as a Section 72 policy at inception, not afterwards.
- Funded by the person whose death triggers the payout (or their spouse/civil partner for joint lives).
- Used, in fact, to pay CAT on the estate.
- Proportionate. any excess over the CAT bill is treated as a normal taxable benefit to the beneficiary who receives it.
Section 72 cover is usually bought as whole-of-life cover for the sum likely to represent the future CAT charge on the estate. Premiums are not deductible for income tax but the benefit is the tax-free payout at death when it is most needed.
When Section 72 pays for itself
For parents with property and savings likely to cross the Group A threshold, a Section 72 policy is often the cleanest way to pass the full estate intact. Without it, children often have to sell the family home to fund the CAT charge. With it, the policy proceeds fund the tax and the home passes to the next generation.
What does not qualify
- Standard term life insurance
- Mortgage protection policies
- Work-related death-in-service benefits
- Pension death benefits (these have their own tax rules)
- Any policy where the Section 72 designation was added after inception
If there is any doubt, the insurer can confirm in writing. Request this before relying on the tax treatment.
This calculator is a preparation tool using Irish tax rates and rules for 2026. It is not legal or tax advice. For complex estates, consult a solicitor or tax adviser. All values are estimates based on the information you provide.