Inheriting Your Parents’ House: Tax, BER, and What to Do First
Inheriting a family home is emotionally difficult and administratively complex. There are tax implications, legal steps, and practical decisions to make. Here’s a clear guide to what needs to happen and in what order.
Step 1: Understand Your Tax Position
When you inherit property, you may owe Capital Acquisitions Tax (CAT) at 33% on the value above your tax-free threshold. For children inheriting from parents (Group A), the current lifetime threshold is approximately €400,000. If the property is worth €350,000 and you’ve received no previous gifts/inheritances from your parents, you owe zero CAT.
If the value exceeds your threshold, our Inheritance Tax Calculator will show your exact liability.
Step 2: Check the Dwelling House Exemption
If you lived in the house for the 3 years before inheritance and have no other property, the entire value may be exempt from CAT under the dwelling house exemption. This can save tens of thousands in tax. Key conditions: you must have lived there as your main home for 3 continuous years, you must not own or have an interest in any other residential property, and you must continue to live there for 6 years after inheritance.
Step 3: Get a BER Certificate
If you plan to sell or rent the inherited property, you’ll need a valid BER certificate. This is a legal requirement for all property sales and lettings. The BER assessment fee (€150–€300) is tax-deductible if you’re renting. Book your BER at Homerating.ie
Step 4: Decide — Keep, Sell, or Rent?
- Keep as your home: No stamp duty, no CGT. Consider the dwelling house exemption for CAT.
- Sell: You may owe CGT at 33% on any increase in value from the date of death. The buyer pays stamp duty. Use our Stamp Duty Calculator for their cost.
- Rent: Rental income is taxable. Use our Landlord Tax Calculator. You’ll need a BER cert, RTB registration, and compliance with all landlord regulations.
- Renovate then sell/rent: Check the Renovation ROI Calculator and Vacant Property Grant Calculator (up to €50,000 for renovation).