Section 72 policy
Relief was introduced by Section 60, of the 1985 Finance Act (now contained in S.72 of Capital
Acquisitions Tax Consolidation Act 2003) to allow people to plan for the payment of Inheritance
Tax in an efficient way.
If a life assurance policy is put in place to provide for the tax, the Revenue will not charge
Inheritance Tax on the policy proceeds if the money is used to pay Inheritance Tax arising on
the death of the lives assured under the policy.

What are the Inheritance Tax limits?

Relationship to Disponer
Son/Daughter €225,000
Brother/Sister/Nephew €30,150
Niece/Grandchild
Relationship other than €14,950
above

So in real terms, if a parent wills €500,000 in cash or wills the family home to a child, then the first €225,000 is tax free, the remaining €250,000 is taxable at 33%. So an amount equal to €74,250 is due in tax. A section 72 policy would pay this tax on death and there by the relative gets the full €500,000 tax paid.

Why not check out how inheritance tax issues may will effect you by clicking on one of these links

Non-Married Couples link .

Passing on Business Assets link.

Would you like a policy that pays any Inheritance tax issues?

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