Valuation date and the value of benefits

Limited interest

If you inherit less than the full, or absolute, ownership of a gift or inheritance, it is called a limited interest. You may inherit a limited interest for life or for a specified time.

The taxable value of a limited interest is less than the taxable value of a full or absolute ownership or interest in property. The taxable value of a limited interest is calculated based on two criteria.

In the case of a:

  • life interest, the age and gender of the beneficiary
  • specified period of time, the number of years for which the benefit is taken.

To calculate the taxable value of a limited interest, you must use the tables provided in Schedule 1, Capital Acquisitions Tax Consolidation Act, 2003. Tables A and B provide the factors for calculating the taxable value for:

  • a single life
  • joint lives
  • the longer of two or more lives
  • and
  • an interest that is guaranteed for a specified time.

Next: Factors used for calculating the value of limited interest