Business Relief: plain-English guide for Irish probate
A 90 per cent reduction in the taxable value of qualifying business assets for CAT, available where the business has been owned for a minimum period and the beneficiary continues to use it for business purposes.
What it means, in plain English
Business Relief reduces the taxable value of qualifying business assets (shares in a family company, sole-trader assets, partnership interests) by 90 per cent for CAT. Like Agricultural Relief, it can turn a substantial CAT bill on an inherited business into zero or near-zero. Unlike Agricultural Relief, there is no 80 per cent asset test; the conditions focus instead on the nature of the business and the beneficiary's continued involvement.
Business Relief in Irish probate practice
Qualifying business property covers a trading business or interest in a trading company where the disponer owned the property for at least 5 years before a gift, or 2 years before an inheritance. The business must carry on a trade, profession, or vocation; pure investment companies and dealing in securities, stocks, land, or buildings do not qualify. Minority shareholdings in family trading companies do qualify provided the relevant family group controls the company. The beneficiary must keep the business property as a qualifying asset for 6 years after the gift or inheritance; selling within that window triggers a full clawback unless the proceeds are reinvested in replacement qualifying assets within 1 year. A partial clawback applies where part of the business ceases to qualify. Business Relief is not available alongside Agricultural Relief on the same asset, but an estate can combine both reliefs across different assets (for example, a working farm with Agricultural Relief and a separate retail business with Business Relief).
Worked example
Niamh inherits her mother's small Dublin cafe business (incorporated 15 years ago) worth 450,000 euro. Her mother owned 100 per cent of the shares for the full 15 years, comfortably clearing the 2-year inheritance minimum. The cafe is an active trading business. Business Relief reduces the taxable value from 450,000 euro to 45,000 euro. Niamh's total inheritance of 45,000 euro relieved value plus 80,000 euro cash is 125,000 euro, well below the 400,000 euro Group A threshold. Her CAT bill is zero. She must continue the business (or replace the asset) for at least 6 years, or face a clawback.
The statutory position
Sections 92 to 102 Capital Acquisitions Tax Consolidation Act 2003. Section 93 defines qualifying business property. Section 100 sets out the clawback for disposal within 6 years. Finance Act 2024 made minor technical amendments but did not introduce an active-management disponer test equivalent to Agricultural Relief.
Related terms in this glossary
Related reading
How ProbatePack handles Business Relief
Everything in the Preparation Pack plus the full inheritance-tax layer. CAT calculator for each beneficiary, individual IT38 drafts, Dwelling House Exemption assessment, Section 72 check, Agricultural and Business Relief assessments where applicable, and the Revenue clearance letter. For estates that will cross the Group A threshold.