Dispositions by or to a company
Legislation - Section 43, Capital Acquisitions Tax Consolidation Act 2003.
This section applies only to private companies as defined in section 27 of the Act.
For the purpose of assessing a liability to CAT, you must look through a company that has made or received a gift/inheritance to ascertain who the shareholders of that company are. Those individuals will then be treated as having given or received a benefit and that benefit will be the same proportion as the proportion they would receive if the company were wound up voluntarily on the date of the benefit.
Example
ABC Ltd. a private non-trading company gives a gift of €100,000 to Michael Barry.
The shareholders in ABC Ltd. are as follows:
- John Barry (father of Michael) 50%
- Mary Barry (mother of Michael) 10%
- Peter Barry (brother of Michael) 40%
Michael is deemed to take the following gifts:
- From John €50,000
- From Mary €10,000
- From Peter €40,000