Glossary · Tax

Small Gift Exemption: plain-English guide for Irish probate

An annual CAT exemption of €3,000 per donor per beneficiary, usable every calendar year without eroding the lifetime group threshold.

Updated April 2026. Plain-English guide for Irish executors, administrators, and beneficiaries.

What it means, in plain English

The Small Gift Exemption is a €3,000 annual CAT exemption per donor per beneficiary. A parent can give each child €3,000 per year without any CAT consequence, without any filing requirement, and without reducing the child's lifetime Group A threshold. The exemption is one of the most practically useful pieces of CAT planning available to Irish families.

Small Gift Exemption in Irish probate practice

The rule is set out in Section 69 of the Capital Acquisitions Tax Consolidation Act 2003. It is a per-donor, per-beneficiary, per-year exemption. A child can receive €3,000 each year from each parent, and each grandparent, and each uncle and aunt, and so on, without consequence. A wealthy couple with four children could distribute €24,000 per year (€3,000 from each parent to each child) free of CAT. Crucially, the exempt amount does not aggregate. It sits entirely outside the lifetime total. Only the amount above €3,000 from any one donor in any one year counts as taxable. Timing matters: the exemption is annual and does not carry over. If no gift is made in a calendar year, that year's exemption is lost. For larger gifts straddling the threshold, planners often split the transfer across two tax years to use two years of the exemption against the same transfer. Revenue's position on repeated use is straightforward: gifts of €3,000 per donor per year are accepted, provided they are genuine gifts and not disguised consideration for something else.

Worked example

Maeve, her husband Declan, Declan's mother, and Maeve's father each give their daughter Aoife €3,000 every Christmas. That is €12,000 per year into Aoife's account, with zero CAT consequence, zero filing, and zero threshold erosion. Over 10 years, Aoife receives €120,000 in what would otherwise be taxable gifts. Her lifetime Group A and Group B thresholds are untouched, so she retains the full headroom for later inheritances from those same relatives.

The statutory position

Section 69 of the Capital Acquisitions Tax Consolidation Act 2003 creates the Small Gift Exemption. The €3,000 figure has been fixed since 2003 and was not changed by subsequent Finance Acts. Revenue guidance confirms the exemption is per donor, per beneficiary, per calendar year, and does not aggregate into lifetime totals.

Related terms in this glossary

  • CAT (Capital Acquisitions Tax): The Irish tax on gifts and inheritances, charged at 33% on the value of a beneficiary's inheritance above their applicable group threshold.
  • Aggregation: The rule that every taxable gift or inheritance from the same CAT group since 5 December 1991 is added together before the group threshold is applied.
  • Valuation date: The specific date CAT uses to fix the value of an inherited asset; usually the date of the Grant of Probate, but subject to specific rules for different asset types.
  • IT38 return: The Revenue return a beneficiary files when their gift or inheritance takes them above 80% of the applicable CAT group threshold.

Related reading

How ProbatePack handles Small Gift Exemption

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.

Get the Complete Probate Bundle for €449

This glossary entry is general preparation guidance, not legal or tax advice. For complex estates, contested wills, or situations involving significant tax structuring, consult a solicitor or tax adviser.