Dáil Éireann Debate, Wednesday - 6 May 2026
244. Deputy Conor Sheehan asked the Tánaiste and Minister for Finance the position for a landlord who charges below market rent under the Capital Acquisitions Tax Consolidation Act 2003, if a tenant is deemed to have occupied property without paying market rent; if the difference between the rent paid and the market rent is deemed a taxable gift; and if he will make a statement on the matter. [33299/26]
View answer245. Deputy Conor Sheehan asked the Tánaiste and Minister for Finance if he plans to alter section 40 of the Capital Acquisitions Tax Consolidation Act 2003, to examine the fact that rent forbearance is treated as a gift in the period it occurs, potentially creating a tax liability for the tenant; and if he will make a statement on the matter. [33300/26]
View answer246. Deputy Conor Sheehan asked the Tánaiste and Minister for Finance if the Revenue Commissioners can provide guidance to ensure that temporary rent reductions offered to tenants facing financial hardship do not trigger a significant CAT liability on the tenant, acting as a barrier to supporting tenants; and if he will make a statement on the matter. [33301/26]
View answer247. Deputy Conor Sheehan asked the Tánaiste and Minister for Finance if he will formalise into legislation the Revenue Commissioners guidance that allows for adult children to live at home without incurring CAT, given the current financial constraints on young people; and if he will make a statement on the matter. [33302/26]
View answerI propose to take Questions Nos. 244, 245, 246 and 247 together.
I am advised by Revenue that, in accordance with section 40 of the Capital Acquisitions Tax Consolidation Act (CATCA) 2003, where a person has the use, occupation or enjoyment of property, without paying full consideration, they are deemed to take a gift for Capital Acquisitions Tax (CAT) purposes. This gift is deemed to consist of the difference between the amount of any consideration given by the person for the use, occupation or enjoyment of the property and the best price obtainable in the open market for such use, occupation or enjoyment. The person will take a gift in each year that they have the use, occupation or enjoyment of the property without paying full consideration.
Section 40 would apply in circumstances where a person has the use of a property rent free, or for a rent that is less than the rent that would be payable for an equivalent property on the open market. Revenue has published guidance on its website, including illustrative examples, on the CAT treatment that would apply in such circumstances. This guidance is available at www.revenue.ie/en/gains-gifts-and-inheritance/valuation-date-value-certain-benefits/free-use-property-interest-free-loans.aspx.
CAT is a self-assessed tax and it is for the beneficiary of a gift to self-assess the value of the benefit received. The extent to which a charge to CAT arises in respect of any deemed gift under section 40 CATCA 2003 will depend on the specific facts and circumstances, including the nature of the arrangement entered into and the CAT Group threshold available to the beneficiary.
Where a charge to CAT arises under section 40, the small gift exemption may be available to the beneficiary. This provides that a person may receive gifts up to the value of €3,000 from any person in a calendar year without having to pay CAT. Where the value of a gift from a person exceeds €3,000, only the excess is taken into account for calculating CAT.
In relation to PQ 33301/26, Revenue have not raised this matter to date however I will ask my officials to examine.
Revenue has also published guidance in relation to the non-exclusive occupation of the family home by an adult child (including their spouse/partner). This guidance confirms Revenue’s view that such non-exclusive occupation does not give rise to a gift from the owner of the property to the family member. This guidance is available at www.revenue.ie/en/gains-gifts-and-inheritance/documents/cat-treatment-receipts-children.pdf.
Finally, the Deputy should note that any further changes to CAT policy must be considered among various other demands within the overall Budget package, as they have been in the past. In that regard, you should note that the CAT policy is kept under review annually by my officials throughout the Finance Bill cycle.
