Exemption for support, maintenance and education payments

Certain gifts of money, or money's worth, taken for support, maintenance or education are exempt from Capital Acquisitions Tax (CAT). The exemption applies where the gift is taken during the lifetime of the disponer by:

• a child of the disponer or the civil partner of the disponer who is:
  • under 18 years of age
  • or
  • aged between 18 and 25 years of age and in full time education
  • or
  • unable to maintain themselves due to a permanent physical or mental disability (there is no age limit on this condition).
• a person to whom the disponer stands in loco parentis (in place of a parent).

The exemption also applies to gifts for support and maintenance to a dependant relative of the disponer or the disponer’s spouse or civil partner. The gift must be taken during the lifetime of the disponer.

Gifts for support, maintenance or education must be:

• part of the normal expenditure for a person in the circumstances of the disponer
• and
• reasonable in relation to the financial circumstances of the disponer.

Payments where the disponer is deceased

Payments for support, maintenance or education are exempt from CAT, where the disponer and the child’s other parent are deceased. The exemption applies where the payment is taken by:

• a child of the disponer or the civil partner of the disponer who is:
  • under 18 years of age
  • or
  • aged between 18 and 25 years of age and in full time education
  • or
  • unable to maintain themselves due to a permanent physical or mental disability (there is no age limit on this condition).

Payments for support, maintenance or education must be:

• part of the normal expenditure for a person in the circumstances of the disponer immediately before the death of the disponer
• and
• reasonable in relation to the financial circumstances of the disponer immediately before the death of the disponer.