Gift and Inheritance Tax (Capital Acquisitions Tax – CAT)

Powers of revocation

A gift that is subject to a power of revocation means that the person making the gift has reserved the right to revoke the gift. No Capital Acquisitions Tax (CAT) is due in this situation.

CAT becomes payable if the person who gave the gift either:

  • releases the power of revocation and it becomes a full gift for CAT purposes
  • or
  • dies and the gift becomes an inheritance.

If you have free use of a benefit that is subject to a power of revocation, a charge to CAT may arise. CAT is calculated on the annual value of the benefit. 

This benefit is deemed to be taken on 31 December for each year that you have free use of the benefit.