Must I sell before Will goes to probate?
Q I am the sole beneficiary of my late parent’s estate. The bulk of the estate is made up of the family home which I am about to put on the market. Does it have to sell before my mother’s will can go to probate? The agent estimates it could sell for in the region of €800,000. If the estate can go to probate before the house sale, when do I pay Inheritance and Probate tax? And is it on the €800,000 – which in this market I realise the house might not get?
A Tax, especially when it comes to inheritance, is a hugely complex area and we sought advice from Finola O’Hanlon from O’Hanlon Tax (ohanlontax.ie). She says that you do not need to sell assets before you apply for a Grant of Probate. As your mother left a will you can contract to sell the house now, but cannot finalise the sale until the Grant issues.
The payment date for inheritance tax (Capital Acquisitions Tax or CAT) depends on when the valuation date falls. “Valuation date” is a legal term and selecting a date can be complicated so professional advice should be obtained. In short, you need to identify the date on which the asset is allocated to a beneficiary, or could be allocated. Revenue generally accept one of two dates: (i) the date of death (for a beneficiary in possession of the asset), or (ii) the date of the Grant. If you are not living in the house, Revenue are likely to accept the date of Grant as the valuation date.
You’ll have to pay the CAT when due, even if the house is not sold. If the date is on or before August 31st, the CAT is due by September 30th, 2011 (under Finance Act 2011). The CAT payment date is likely to move back to October 31st later this year to stay in line with income tax and CGT. The current rate of CAT is 25% and the tax is based on the value of assets at the valuation date, not the sales price, even if the assets later sell for a lower price. Probate tax was abolished for deaths occurring on or after December 6th, 2000.
How much is BER grant for insulation?
Q The company I contacted about insulating my attic told me that I am entitled to a grant of €250 for the insulation and €100 for the BER assessment (they also supply this) – although the actual BER fee will be €199 so I will have to supplement the grant. A family member got €200 to pay the BER person. Is this company trying to pull a fast one?
A No. The grant system changed in the middle of last year and the grant for a BER assessment is now €100 per home. (It used to be €200). The rationale for the reduction is that it was the case that the BER assessment was done before and after the grant-aided work was undertaken – so the assessor would have had to call out twice, write two reports, etc. Now, for the purpose of the grant, the BER has to be carried out only after the work has been done to satisfy the terms of the application. It is best not to look to contractors for grant advice: contact Sustainable Energy Ireland (sei.ie) for grant guidelines and a list of approved contractors.
Your questions
Send your queries to Property Questions, The Irish Times, The Irish Times Building, 24-28 Tara Street, Dublin 2 or e-mail propertyquestions@irishtimes.com. This column is a readers’ service and is not intended to replace professional advice.
