PART 3

Inheritance Tax

Chapter 1

General

9. —A capital acquisitions tax, to be called inheritance tax and to be computed in accordance with this Act, shall, subject to this Act and any regulations made under the Act, be charged, levied and paid on the taxable value of every taxable inheritance taken by a successor.

10. —(1) For the purposes of this Act a person is deemed to take an inheritance, where, under or in consequence of any disposition, a person becomes beneficially entitled in possession on a death to any benefit (whether or not the person becoming so entitled already has any interest in the property in which such person takes such benefit), otherwise than for full consideration in money or money's worth paid by such person.

(2) Subsections (2), (4) and (5) of section 5 shall apply, with any necessary modifications, in relation to an inheritance as they apply in relation to a gift.

(3) For the purposes of section 11 (1)(b) and 11(2)(c), the sum referred to in section 5 (2)(b) is deemed not to be situate in the State at the date of the inheritance.

(4)  (a) In paragraph (b), the expression “shares in a private company” is construed by reference to the meanings that “share” and “private company” have, respectively, in section 27 .

(b) Where a person becomes beneficially entitled in possession to a benefit, and the property in which the benefit is taken consists wholly or partly of shares in a private company and where the consideration referred to in subsection (1), being consideration in relation to a disposition, could not reasonably be regarded (taking into account the disponer's position prior to the disposition) as representing full consideration to the disponer for having made such a disposition, subsection (1) is deemed to apply as if “otherwise than for full consideration in money or money's worth paid by such person” were deleted in that subsection.

11. —(1) In relation to an inheritance taken under a disposition, where the date of the disposition is before 1 December 1999, “taxable inheritance” in this Act means—

(a) in the case where the disponer is domiciled in the State at the date of the disposition under which the successor takes the inheritance, the whole of the inheritance, and

(b) in any case, other than the case referred to in paragraph (a), where, at the date of the inheritance—

(i) the whole of the property—

(I) which was to be appropriated to the inheritance, or

(II) out of which property was to be appropriated to the inheritance,

was situate in the State, the whole of the inheritance;

(ii) a part or proportion of the property—

(I) which was to be appropriated to the inheritance, or

(II) out of which property was to be appropriated to the inheritance,

was situate in the State, that part or proportion of the inheritance.

(2) In relation to an inheritance taken under a disposition, where the date of the disposition is on or after 1 December 1999, “taxable inheritance” in the Act means—

(a) in the case where the disponer is resident or ordinarily resident in the State at the date of the disposition under which the successor takes the inheritance, the whole of the inheritance,

(b) in the case where the successor (not being a successor in relation to a charge for tax arising by virtue of sections 15(1) and 20(1)) is resident or ordinarily resident in the State at the date of the inheritance, the whole of the inheritance, and

(c) in any case, other than a case referred to in paragraph (a) or (b), where at the date of the inheritance—

(i) the whole of the property—

(I) which was to be appropriated to the inheritance, or

(II) out of which property was to be appropriated to the inheritance,

was situate in the State, the whole of the inheritance;

(ii) a part or proportion of the property—

(I) which was to be appropriated to the inheritance, or

(II) out of which property was to be appropriated to the inheritance,

was situate in the State, that part or proportion of the inheritance.

(3) For the purposes of subsections (1)(b) and (2)(c)—

(a) “property which was to be appropriated to the inheritance” and “property out of which property was to be appropriated to the inheritance” shall not include any property which was not applicable to satisfy the inheritance, and

(b) a right to the proceeds of sale of property is deemed to be situate in the State to the extent that such property is unsold and situate in the State.

(4) For the purposes of subsection (2), a person who is not domiciled in the State on a particular date is treated as not resident and not ordinarily resident in the State on that date unless—

(a) that date occurs on or after 1 December 2004,

(b) that person has been resident in the State for the 5 consecutive years of assessment immediately preceding the year of assessment in which that date falls, and

(c) that person is either resident or ordinarily resident in the State on that date.

(5) (a) In this subsection—

“company” and “share” have the same meaning as they have in section 27 ;

“company controlled by the donee” has the same meaning as is assigned to “company controlled by the donee or successor” by section 27 .

(b) For the purposes of subsection (2)(c), a proportion of the market value of any share in a private company incorporated outside the State which (after the taking of the inheritance) is a company controlled by the successor is deemed to be a sum situate in the State and is the amount determined by the following formula—

where

A is the market value of that share at the date of the inheritance ascertained under section 27 ,

B is the market value of all property in the beneficial ownership of that company which is situate in the State at the date of the inheritance, and

C is the total market value of all property in the beneficial ownership of that company at the date of the inheritance.

(c) Paragraph (b) shall not apply in a case where the disponer was not domiciled in the State at the date of the disposition under which the successor takes the inheritance or where the share in question is actually situate in the State at the date of the inheritance.

12. —(1) If—

(a) (i) a benefit under a will or an intestacy, or

(ii) an entitlement to an interest in settled property,

is disclaimed;

(b) a claim—

(i) under a purported will in respect of which a grant of representation (within the meaning of the Succession Act 1965 ) was not issued, or

(ii) under an alleged intestacy where a will exists in respect of which such a grant was issued,

is waived; or

(c) a right under Part IX of the Succession Act 1965 , or any analogous right under the law of another territory, is renounced, disclaimed, elected against or lapses,

any liability to tax in respect of such benefit, entitlement, claim or right shall cease as if such benefit, entitlement, claim or right, as the case may be, had not existed.

(2) Notwithstanding anything contained in this Act—

(a) a disclaimer of a benefit under a will or intestacy or of an entitlement to an interest in settled property;

(b) the waiver of a claim—

(i) under a purported will in respect of which a grant of representation (within the meaning of the Succession Act 1965 ) was not issued, or

(ii) under an alleged intestacy where a will exists in respect of which such a grant issued; or

(c) (i) the renunciation or disclaimer of,

(ii) the election against, or

(iii) the lapse of,

a right under Part IX of the Succession Act 1965 , or any analogous right under the law of another territory,

is not a disposition for the purposes of this Act.

(3) Subsection (1) shall not apply to the extent of the amount of any consideration in money or money's worth received for the disclaimer, renunciation, election or lapse or for the waiver of a claim; and the receipt of such consideration is deemed to be a gift or an inheritance, as the case may be, in respect of which no consideration was paid by the donee or successor and which was derived from the disponer who provided the property in relation to which the benefit, entitlement, claim or right referred to in subsection (1), arose.

13. —(1) On the death of one of several persons who are beneficially and absolutely entitled in possession as joint tenants, the surviving joint tenant or surviving joint tenants is or are deemed to take an inheritance of the share of the deceased joint tenant, as successor or successors from the deceased joint tenant as disponer.

(2) The liability to inheritance tax in respect of an inheritance taken by persons as joint tenants is the same in all respects as if they took the inheritance as tenants in common in equal shares.