Inheriting or receiving a gift from India as an Irish resident

The Indian side is the easy half. India has no inheritance tax and no gift tax, and the income-tax law exempts anything you receive under a will, by inheritance, or as a gift from a relative, under the proviso to Section 56(2)(x). So money or property coming to you from India is tax-free in India on receipt, and there is no Indian tax to set against anything elsewhere. A large gift from a non-relative can be taxable in India above ₹50,000, but a genuine inheritance or a gift from close family is clear.

Ireland is where the real tax question is. Capital Acquisitions Tax, or CAT, is Ireland's gift and inheritance tax, charged at a flat 33 per cent on the value above a tax-free threshold, and it falls on you, the person receiving. Because you are resident in Ireland, CAT reaches worldwide gifts and inheritances, so an Indian inheritance is fully within it, exactly like an Irish one. The thresholds are lifetime totals by relationship: roughly €400,000 for a child from a parent, about €40,000 for a wider relative such as a sibling or niece, and about €20,000 for anyone else, plus a small gift exemption of €3,000 a year from each person. Above the threshold, the 33 per cent applies to the excess.

Here is the relief that changes everything for someone who has recently moved from India, and the point most easily missed. CAT is not an income tax, so the non-domicile remittance basis that helps with income does not help here. But there is a separate, powerful rule tied to domicile. If you are not Irish-domiciled, and as an NRI who has recently moved you are very likely still Indian-domiciled, you are not treated as resident or ordinarily resident for CAT purposes until you have been resident in Ireland for the five consecutive tax years immediately before the year of the gift or inheritance. In plain terms, for your first five years in Ireland, an Indian inheritance or a gift from India generally falls outside Irish CAT altogether. Only Irish-situated assets stay in charge during that window.

That makes the timing of an inheritance, and your domicile status, the single biggest thing to get right, and it is worth taking advice on before assuming CAT applies. There is no CAT treaty between Ireland and India, and because India charges no death tax there is nothing to credit against a CAT bill once it does arise. Our role is the Indian end, not Irish CAT advice, which your Irish adviser handles: we provide the legal heir and succession paperwork, a valuation of the Indian asset, a certificate confirming no Indian inheritance tax is due, and the repatriation of the inherited funds out of India to you.