The Gazette 1977

236 / 264

GAZE1TE DECEMBER 1977
tenants in common in consideration of natural love and
affection would be an example of a transaction in respect
of which a certificate of discharge from Gift Tax would be
required. This applies no matter how small the value of
the property may be, as the purchaser cannot be certain
that there have not been previous taxable gifts sufficient to
exhaust the tax-free threshold between the spouses.
It should be noted that there can be a liability to Gift
Tax in any case where full consideration has not been
paid by the donee, even though there may have been no
intention on the part of the donor to benefit the donee. A
sale at an undervalue, which both parties mistakenly
believe to be the true market value, would give rise to a
charge to Gift Tax. In some cases there will be nothing on
the title to alert a purchaser to the fact that an earlier sale
was at an undervalue. Under Section 47(3) of the C.A.T.
Act the purchaser, not having been put on notice of the
gift, will take the property free of the charge to C.A.T.
However, it is necessary to be careful in any case where
there has been a -ale between close relatives. The Stamps
Branch of the Revenue Commissioners will normally
require a conveyance or transfer between close relatives
to be adjudicated. In many cases they will maintain that
the market value is greater than the sale price, and stamp
duty will be payable at 1% on a consideration greater
than the consideration stated in the conveyance or
transfer. Such a conveyance or transfer will therefore be
one under which the transferee becomes entitled
"otherwise than for full consideration in money or
money's worth paid by him" and will give rise to a charge
to Gift Tax. It is essential therefore that any subsequent
purchaser should obtain a certificate of discharge from
Gift Tax.
In all cases the Vendor's Solicitor applies for a
certificate of discharge by completing in duplicate a form
This form gives full details of the property
comprised in the gift or inheritance and specifies the
nature and date of the disposition (e.g. will or deed of
appointment) under which the benefit was taken. The
application is for a discharge from capital acquisitions
tax, and the applicant does not have to specify whether
gift tax or inheritance tax is the relevant tax. The Revenue
then return one copy of the form C.A. 11 to the applicant,
having completed the certificate at the foot of the form
that on the facts as disclosed there is no outstanding
charge for gift/inheritance tax (as appropriate).
As in the case of death duties, the printed certificate of
discharge from gift/inheritance tax at the foot of form
C.A. 11 reserves the right of the Revenue to readjust the
taxable value in the event of a sale or compulsory
acquisition, although in this case the right applies only if
the sale or compulsory acquisition takes place within
three years from the date of the gift or inheritance.
In addition, if the property comprised in the gift or
inheritance included "agricultural property" to which
"agricultural value" applied under Section 19, the
certificate reserves the right of the Revenue to re-adjust
the taxable value in the event of a sale or compulsory
acquisition within six years from the date of the gift or
inheritance. The reference here is to the relief given by
Section 19 of the Capital Acquisitions Tax Act, which
reduces by the lesser of 50% or £100,000 the taxable
value of a gift or inheritance taken by an individual who
qualifies as a "farmer" under the Section. The relief is lost
and the full amount of tax becomes payable if the
agricultural property is sold or compulsorily acquired
within six years after the date of the gift or inheritance
and is not replaced by other agricultural property within
one year of the sale or compulsory acquisition.
The Solicitor for the purchaser must ensure that the
Revenue have deleted these paragraphs from the
certificate and that the discharge from Capital
Acquisitions Tax is absolute or unconditional.
(Part II of this Article, which will appear in the next
issue, will deal with Wealth Tax and Capital Gains Tax.)
ACTS OF THE OIREACHTAS, 1977
No. Name of Statute Signed by President
1. Local Government (Water Pollution) Act 19 March 1977
2. Health Contributions (Amendment) Act 1977 21 March 1977
3. Social Welfare Act 1977 21 March 1977
4. Bula Limited (Acquisition of Shares) Act
1977 29 March 1977
5. European Communities (Amendment) Act
1977 29 March 1977
6. Worker Participation (State Enterprises) Act
1977 4 April 1977
7. Protection of Employment Act 1977 5 April 1977
8. Intoxicating Liquor Act 1977 5 April 1977
9. Protection of Young Person (Employment)
Act 1977 6 April 1977
10. Unfair Dismissals Act 1977 6 April 1977
11. Courts Act 1977 10 May 1977
12. Misuse of Drugs Act 1977 18 May 1977
13. National Agricultural Advisory, Education
and Research Authority Act 1977 24 May 1977
14. Prisons Act 1977 24 May 1977
15. Oil Pollution of the Sea (Amendment) Act
1977 1June 1977
16. Employment Equality Act 1977 1 June 1977
17. Friendly Societies (Amendment) Act 1977.. 1 June 1977
18. Finance Act 1977 1 June 1977
19. Breton Woods Agreement (Amendment) Act
1977 1 June 1977
20. Industrial Credit (Amendment) Act 1977.... 9 Nov. 1977
21. Export Promotion (Amendment) Act 1977.. 9 Nov. 1977
22. Telephone Capital Act 1977 9 Nov. 1977
23. Dairy Produce (Miscellaneous Provisions)
(Amendment) Act 1977 9 Nov. 1977
24. Garda Siochana Act 1977 ? 15 Nov. 1977
25. National Board for Science and Technology
Act 1977 16 Nov. 1977
26. Control of Exports (Temporary Provisions
Act 1956) (Continuance) Act 1977 30 Nov. 1977
27. Ministers and Secretaries (Amendment) Act
1977 6 Dec. 1977
28. Ministers and Secretaries (Amendment) (No.
2) Act 1977 6 Dec. 1977
29. Oireachtas (Allowances to Members) and
Ministerial, Parliamentary and Judicial
Officer (Amendment) Act 1977 8 Dec. 1977
30. European Assembly Elections Act 1977 9 Dec. 1977
31. Companies (Amendment) Act 1977 12 Dec. 1977
32. Finance (Excise Duty on Tobacco) Act 1977 20 Dec. 1977
33. Gaeltacht Industries (Amendment) Act 1977 20 Dec. 1977
34. International Development Association
(Amendment) Act 1977 20 Dec. 1977
35. Nitrigin Eireann Teoranta Act 1977 20 Dec. 1977
36. Appropriation Act 1977 21 Dec. 1977
37. Industrial Development Act 1977 21 Dec. 1977
Private Acts — None
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