Foreign Property and Dwellinghouse Relief

04 June 2021


For some reason the recent headline in the Irish Examiner that Cork and Kerry had the wettest May in 15 years and being unable to leave my house for the last year or so, got me thinking “D’ya know what, a trip abroad may be nice”. I know I am out on a limb here and I am on my own on this one. However, thoughts of foreign travel naturally made me consider assets abroad and their impact on Irish wills.

This came to light recently in advising a client on dwellinghouse relief. The criteria for dwellinghouse relief are as follows:

  1. the house was the only or main home of the person who died (this condition does not apply if you are a dependent relative);
  2. you lived in the house as your only or main home for the three years immediately before the date of the inheritance;
  3. you do not own or have an interest in another house;
  4. you do not acquire an interest in any other house from the same disponer between the date of the inheritance and the valuation date;
  5. the house continues to be your only or main home for six years after the date of the inheritance.

The question arises from time to time on the issue of having an interest in another house. Does this relate only to a house in Ireland or does it include your holiday home in Spain (which you haven’t got to in a while – unless you are one of those brave people who ring the Joe Duffy show from your holiday home during lockdown). The answer is not in this months Conde Nast Traveller (although the pictures of the infinity pool in Monaco are very nice). No, the answer of course is in CAT Manual where it states that “the restriction applies in relation to a dwelling situated either in the State or abroad”. So if you have clients who have an interest in a property abroad (which include Northern Ireland or England) then that client will be disqualified from dwellinghouse relief in Ireland. A bit harsh really, but unfortunately that is the rule.

Now back to googling “Yachting in Biarritz”.