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KNOW YOUR RIGHTS: Capital Gains Tax

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You dispose of an asset when you sell it, give it as a gift, exchange it or get compensation or insurance for it.

If you make a profit or gain when you dispose of an asset, you are liable to pay Capital Gains Tax (CGT) on the chargeable gain. The chargeable gain is usually the difference between the price you paid for the asset and the price you disposed of it for. You can deduct allowable expenses such as the cost of acquiring and disposing of the asset.

When you dispose of an asset, you must file a tax return for CGT by October 31 of the following year.
Although you may file your return the following year, you must pay the Capital Gains Tax in the same year as you dispose of the asset, unless the disposal is in December.

Capital gains that are exempt

Transfers of assets between spouses and civil partners are exempt from Capital Gains Tax. Transfers of assets between spouses and civil partners who are separated are exempt from Capital Gains Tax if they are made under a Separation Agreement or a court order. The transfer of a site from parent to child is exempt if it is to build the child's principal private residence but the land must be less than one acre and have a value of €500,000 or less.

There is no Capital Gains Tax on assets that are passed on death. The assets are treated as if the person who died got the assets at the same value they have on the date of death. If a personal representative disposes of the assets, they are responsible for any gains between the date of the person’s death and the date of disposal.

Principal Private Residence Relief

You may be exempt from CGT If you dispose of a property you own that you lived in as your only or main residence. This relief may also apply if you dispose of a property that you provided for free to a widowed parent or incapacitated relative to use as their sole residence.

There are some restrictions to Principal Private Residence Relief, including that you can only claim the relief for:

The part of the house that you used as your home

The time you lived in the property, with some exceptions for work or health reasons

The value of the property as you currently use it, rather than for development potential

Other exemptions

Other exemptions from Capital Gains Tax include gains from:

Betting, lotteries, sweepstakes and prize bonds

Bonuses payable under the National Instalments Savings Schemes

Government stocks

Certain life assurance policies

Moveable property, if the gain is €2,540 or less

Animals

Private motor cars

If you dispose of land or buildings you acquired between December 7, 2011 and December 31, 2014 you can get relief from CGT in certain cases.

Rate and payment of Capital Gains Tax

The standard rate of Capital Gains Tax is 33% of the chargeable gain you make. A rate of 40% can apply to the disposal of certain foreign life assurance policies and units in offshore funds. For certain windfall gains the windfall gains rate of tax is 80%.

Deductions

You can deduct allowable expenses from the chargeable gain, including:

Money you spent that adds value to the asset

Costs to acquire and dispose of the asset (for example solicitor fees)

You may also be able to deduct an allowable loss you made in the same tax year.
 

When to pay CGT

The tax year is divided into two periods:

An 'initial period' from January 1 to November 30

A 'later period' from December 1 to December 31

For disposals in the initial period CGT payments are due by December 15 in the same tax year. CGT for disposals in the later period are due by January 31 in the following tax year. For example, if you dispose of an asset in the period January to November 2022 you must pay the Capital Gains Tax due to Revenue before December 15 2022. If you dispose of an asset in December 2022, the Capital Gains Tax will be due on January 31 2023.

How to pay Capital Gains Tax

If you are registered for CGT, you must pay your CGT online using Revenue Online Service (ROS) or myAccount. If you are not registered for CGT, you must register for CGT and then make a payment using ROS or myAccount.

How to Register

You can register for CGT:

If you have a tax registration number, by sending a request through MyEnquiries

If you have never been registered for tax, by completing Form TR1 (or FORM TR1 FT for self-assessment).

How to file a tax return for capital gains

You must file a tax return on all disposals. When you dispose of an asset, you must file a return by October 31 of the following year. Though you may file your return the following year, you must pay the Capital Gains Tax in the same year as the disposal of the asset, unless you dispose of the asset in December.

If you assess yourself for tax purposes (self-assessment) you should make a tax return on Form 11.
If you are a PAYE taxpayer you should make a return on Form 12. Trusts and Estates should make the return on Form 1. If you are not required to make an income tax return you must send a CG1 Form to Revenue. You can use ROS to file your Income Tax Return (Form 11), Form 1 or Form CT1. You can post the Form CG1 or Income Tax Return (Form 12) to your Revenue office. Forms are available online or you can contact your local Citizens Information Centre.

If you need further information about any of the issues raised here or you have other questions, you can call a member of the local Citizens Information Service in Kerry on 0818 07 7860. They will be happy to assist you and if necessary arrange an appointment for you.

Kerry HELPLINE 0818 07 7860 Monday to Friday from 10am to 4pm. Alternatively you can email tralee@citinfo.ie or log on to www.citizensinformation.ie.

The National Phone Service is available on 0818 07 4000 Monday to Friday 9am to 8pm.

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Faulty Towers meets Love Island in new romantic novel

By Michelle Crean The pandemic may have delayed it from hitting the bookshelves sooner – but local author Breda Joy’s latest work has now hit the bookshops. ‘Under a Skellig […]

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By Michelle Crean

The pandemic may have delayed it from hitting the bookshelves sooner – but local author Breda Joy’s latest work has now hit the bookshops.

‘Under a Skellig Sky’ is a combination of Love Island and Fawlty Towers together in this new romantic novel with a bite!

The Skellig islands off the coast of Kerry are the backdrop to the page turner that doles out quick fire laughs as well as confronting issues such as rural crime and depopulation.

Nomadic Carol O’Connell’s return to Glenosheen overlooking the famed craggy Skelligs turns into one more in a series of half-baked decisions that pass for her life.

An experiment with Airbnb in her mother’s old farm guesthouse on the ‘Wet Atlantic Way’, a disastrous re-union with an ex and the rescue of a troubled friend set her tumbling through the year.

Through the sultry heat wave of 2018, she searches for peace to recover from a broken relationship but her sleepy valley homeplace has woken up to Star Wars fever and mass tourism.

But a trip to the stunning Skellig Michael with a mystery guest called Oliver turns the tide in the love stakes for Carol.

“I wrote ‘Under a Skellig Sky’ during the heat wave of 2018 and set it in that summer, drawing directly from the weather conditions as I wrote,” Breda, who is an award winning author and local journalist said.

“As part of my research, I took a boat trip to the Skellig on a day when the sea was like a billiard table and the sky was a sapphire blue. I had been on the island previously, but it was my first time visiting when the puffins were in residence, and it was wonderful to see them. That idyllic day informed my descriptions of the island and sets the background to the visit of my two main characters there.

“When I planned the novel, I set out to write a romantic comedy to provide readers with an escape chute to an imaginary world – similar to the escapism of Love Island,” she said. “I wanted to write a kind of Kerry-based ‘Fawlty Towers’. Humour is very much at the heart of both my fiction and journalism. When I want to get a serious message across, humour is my lure to reel the reader in.

“Having my novels published is a dream-come-true,” Breda said. “It’s such a privilege to be included among the ranks of published Irish writers. Chief among the essential advice I’d give an aspiring writer is not to be isolationist as I have been with the crucial exception of joining a small writing group in Killarney 15 years ago. The support and the constructive criticism of the members advanced me hugely on my writing journey.”

‘Under a Skellig Sky’ was first launched as an eBook on Amazon during the pandemic but is now available in Eason and O’Connor’s Newsagent in Killarney as well as all good book shops.

Breda’s previous non-fiction books include ‘Hidden Kerry, The Keys to the Kingdom’ and ‘The Wit & Wisdom of Kerry’ with Mercier Press Cork. She published ‘Brian Crowley, Against the Odds’, a Biography with Brandon Press in 1996. Her second novel was ‘Eat the Moon’ and she is currently researching her third.

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Camera Club ready to celebrate its 21st anniversary

Killarney Camera Club is ready for the new season and as well as celebrating their 21st birthday – they’re also looking for new members. Next Thursday night they will be […]

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Killarney Camera Club is ready for the new season and as well as celebrating their 21st birthday – they’re also looking for new members.

Next Thursday night they will be holding an Open Night at 7.30pm in the Plaza Suite at The Brehon Hotel.

The club meets every other Thursday at 7.30pm and is open to everyone with an interest in photography, including a junior membership category for 16 to 17-year-olds.

“Whether you’re a complete beginner, or you already know your way around a camera, everyone is welcome,” Deirdre Donohue from the club said.

The club activities include speaker nights, outings, project nights and competitions. At part of the club’s 21st celebrations they will be mounting an exhibition at Killarney House in late October.

“As well as a warm welcome, including tea and biscuits, the Open Night will feature a presentation, by professional photographer Micheál O’Sullivan, of his wonderful landscapes, so come along for a lovely evening of chat and photography!”

If you have any queries, you can contact the club secretary via email at secretary@killarneycameraclub.ie.

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