Capital Gains Tax in Ireland: Rates, Exemptions & Guide
Anyone who has sold a property, gifted shares, or passed on a valuable asset in Ireland has likely wondered how much the taxman takes — the short answer is 33%, but that headline rate comes with reliefs and exemptions that can bring your effective bill close to zero. This guide covers current rates, the most valuable reliefs (including the misunderstood 7-year rule), and exactly how to calculate what you owe.
Standard CGT Rate: 33% · Annual Exemption: €1,270 per person per year · Principal Private Residence Relief: 100% exemption on main home gain · Retirement Relief (7-Year Rule): Full relief from age 65 if held for 7+ years · Inflation Indexation: Not available (since 2003)
Quick snapshot
- Principal Private Residence (Revenue guidance)
- Retirement relief (7‑year rule) (Revenue)
- Entrepreneur relief (10% rate) (Revenue)
- Subtract acquisition cost (Revenue)
- Add allowable expenses (Revenue)
- Apply reliefs and exemption (Revenue)
Here are the key figures at a glance:
| Item | Value |
|---|---|
| Current CGT Rate | 33% (40% for foreign life policies) |
| Annual Exemption | €1,270 per person per year |
| PPR Relief | 100% exemption on main home gain |
| Retirement Relief Age | Full relief from age 65 (7‑year holding rule) |
| Entrepreneur Relief | 10% rate on first €1 million of qualifying gains |
| Filing Deadline | 31 October following year of disposal |
What is the capital gains tax in Ireland?
Capital Gains Tax (CGT) is charged on the profit – not the total sale price – when you sell, gift, exchange, or receive compensation for an asset in Ireland. As the Revenue Commissioners (Ireland’s tax authority) put it: CGT is a tax you pay on any capital gain (profit) made when you sell, gift or exchange an asset.
Who pays capital gains tax?
Anyone who disposes of an asset and makes a chargeable gain is liable, whether you are an individual, a trust, or a company. You must file a return even if no tax is due after exemptions and reliefs, as Revenue makes clear.
What is the current capital gains tax rate?
The standard rate for most gains is 33%, effective since 6 December 2012. There are two exceptions:
- 40% for gains from foreign life policies and foreign investment products
- 15% for gains from venture capital funds for individuals and certain trusts
The 33% rate looks steep, but the real sting for long-term holders is the absence of inflation indexation after 2003. A property bought for €100,000 in 2004 and sold for €150,000 in 2025 is taxed on the full €50,000 gain – even though inflation ate a chunk of that paper profit.
Are there different rates for different types of assets?
Yes. The 40% rate for foreign life policies and the 15% rate for venture capital funds are the main exceptions. For most other assets – property (non-primary residence), shares, land, business assets – the standard 33% applies.
The implication: understanding which rate applies to your asset is the first step to an accurate calculation.
What is the 7 year rule for capital gains in Ireland?
The so-called “7-year rule” is often confused with a general loophole. In reality, it refers to a condition within retirement relief – one of the most valuable CGT reliefs available.
How does the 7 year rule reduce CGT?
If you are aged 55 or over and dispose of qualifying business assets, you may get partial relief. Full relief applies from age 65, provided you have held the asset for at least 7 consecutive years before disposal. As Revenue explains, this means the gain can be completely exempt from CGT.
Who qualifies for retirement relief?
- Individuals aged 55 or older (partial relief)
- Full relief at age 65 with the 7-year holding rule satisfied
- The asset must be a qualifying business asset – typically shares in a family company, a farm, or a business
Revenue guidance also limits the relief to €750,000 of gain fully exempt (2025 thresholds), with partial relief above that.
What are the conditions to claim the 7 year rule?
- You must have owned and used the asset for the 7-year period ending with the disposal
- The disposal must be a “material disposal” – essentially a sale, gift, or transfer of the business
- You must not have already claimed retirement relief on another disposal in the same period
“Full relief for disposal of qualifying business assets at age 65+ – asset must be held for at least 7 consecutive years.”
Revenue
The 7-year rule applies only to business assets, not to investment property or shares in a non-trading company. Many people wrongly believe it covers any asset held for 7 years – Revenue is clear it does not.
The pattern: retirement relief is powerful but narrow; it rewards long-term business ownership, not passive property holding.
How do you calculate capital gains on property?
Calculating CGT on a property sale is a three-step process. Let’s walk through it with a fictional example. Six items, one pattern: subtract what you paid and what you spent, apply reliefs, then multiply by the rate.
| Step | Action | Example (€) |
|---|---|---|
| 1 | Sale proceeds | 300,000 |
| 2 | Minus acquisition cost (purchase price) | –180,000 |
| 3 | Minus allowable expenses (legal fees, stamp duty, improvements) | –15,000 |
| 4 | Chargeable gain before reliefs | 105,000 |
| 5 | Minus annual exemption (€1,270) | –1,270 |
| 6 | Taxable gain | 103,730 |
| 7 | CGT at 33% | 34,231 |
As Revenue confirms, you may also deduct any capital losses from the same tax year before applying the exemption.
Allowable costs include the purchase price, legal fees on acquisition and sale, stamp duty, and capital improvement costs that have added value. Routine maintenance does not count, according to UHY FDW (Irish accountancy firm).
How to apply the annual exemption?
Every individual gets a €1,270 exemption per tax year. If your total chargeable gain is below that, no tax is due. Couples can each use their own exemption on separate gains, but not on a jointly held asset unless they file separately.
Step-by-step calculation example
- Work out the disposal proceeds (sale price or market value if a gift).
- Deduct the acquisition cost and any allowable expenses.
- Deduct capital losses from the same year (or carry forward unused losses).
- Apply the annual €1,270 exemption.
- Apply any relief (PPR, retirement, entrepreneur).
- Multiply the resulting chargeable gain by the appropriate rate (33%, 40%, or 15%).
“Capital Gains Tax is charged on the capital gain or profit made on the disposal of an asset. Some assets are exempt.”
The consequence: sellers must plan their cash flow to meet the accelerated payment deadlines.
How to avoid paying capital gains tax in Ireland?
You cannot “avoid” CGT through loopholes, but you can legally reduce or eliminate it using statutory exemptions and reliefs. The most common are:
What are the main legal exemptions?
- Principal Private Residence (PPR) relief – full exemption on your main home
- Annual exemption – first €1,270 of gains tax-free per person
- Retirement relief – full or partial relief for business asset disposals from age 55
- Entrepreneur relief – a reduced rate of 10% on the first €1 million of qualifying gains (Revenue)
- Gifts between spouses – exempt from CGT
How does principal private residence relief work?
Under Section 604A of the Taxes Consolidation Act 1997, any gain on the sale of your main home is completely exempt, provided the property has been occupied as your principal residence throughout the ownership period. As Citizens Information explains, if you let part of the property or used it for business, a portion of the gain may be taxable.
Are there loopholes or common misunderstandings?
The “big loophole” people talk about online – claiming PPR relief on a former home you rented out for years – is largely a myth. Revenue requires actual occupation as your main residence. That said, the real gap in the system is the lack of inflation indexation after 2003, which means long-term holders are taxed on purely inflationary gains. As TaxAssist (Irish tax advisers) note: “The headline rate of CGT in Ireland is 33%, so approximately one third of your gain will be paid in tax.”
Revenue has become much more aggressive on CGT compliance. If you sell a property and don’t file a CG1 return by 31 October of the following year, you face penalties – and the payment deadline is even earlier (15 December for most sales).
What is the exemption of capital gains on sale of property?
This question usually refers to the Principal Private Residence exemption. Let’s be precise about which properties qualify.
Which properties qualify for full exemption?
Only your main family home – the property you have lived in as your principal residence throughout your ownership period. A second home, holiday home, or investment property does not qualify. Revenue guidance is unambiguous: “Only one property can be claimed as a principal private residence at any one time.”
What is Section 604A of TCA 1997?
This is the legislation that grants PPR relief. It exempts any gain arising from the disposal of a dwelling house that has been the individual’s only or main residence throughout the period of ownership. If you occupied the property for only part of the ownership period, the gain is apportioned – only the occupation period is exempt.
Does the exemption apply to investment properties?
No. Investment properties are fully chargeable to CGT. However, you can deduct the costs of acquisition, sale, and capital improvements. There is no “property trader” exemption – if you buy and sell properties as a business, the profits may be treated as trading income and subject to income tax instead, but that is a separate assessment.
“PPR relief eliminates gain entirely on the sale of your main home. Other exemptions: gifts to charities, certain government securities.”
Revenue
The implication: for investment property, the only way to reduce CGT is via business-focused reliefs or by timing the sale to offset losses.
What the numbers mean for you
Ireland’s CGT system is not the flat 33% it appears on paper. Between the annual exemption, PPR relief, retirement relief, and entrepreneur relief, most disposals by individuals attract a far lower effective rate – often zero. The real sting is the lack of indexation, which penalises long-term holders in a high-inflation environment. For anyone planning a sale, the smartest move is to check which reliefs apply before you sign, because the payment deadlines are tight and Revenue does not offer grace periods.
For the Irish taxpayer selling a primary residence, the choice is clear: file your CG1 on time, claim PPR relief, and pay nothing – or miss the deadline and face interest and penalties that can turn a tax-free gain into a costly mistake.
For a detailed breakdown of the 33% rate and annual exemption, refer to this comprehensive guide to Irish CGT.
Frequently asked questions
What is the capital gains tax rate in Ireland for non-residents?
Non-residents are liable for CGT on gains from the disposal of Irish land and buildings, and on assets used in a trade in Ireland. The standard rate of 33% applies. They may also be able to claim credit for foreign CGT paid under a double taxation agreement, as Revenue notes.
Do I have to pay CGT if I sell my house and buy another?
No – as long as the property you sold was your principal private residence, PPR relief exempts the gain. If you reinvest the proceeds into a new main home, the relief still applies; there is no requirement to roll over the gain.
How does the annual exemption €1,270 work for couples?
Each spouse gets their own €1,270 exemption. If they jointly own an asset and sell it, each can apply their exemption to their share of the gain. They cannot both claim on the same gain unless the asset is held in separate names.
Can I claim both PPR relief and retirement relief?
Generally not on the same asset. PPR relief already eliminates the gain on a main home. Retirement relief is intended for business assets. However, if you lived in a property that also served as your business premises, you may be able to claim apportioned relief under both provisions – Revenue assesses each case individually.
What happens if I don’t file a CGT return on time?
Revenue can impose surcharges of 5% of the tax due for late returns, and interest accrues daily. The CG1 return is due by 31 October of the year after the disposal. Payment for most disposals is due even earlier – by 15 December in the same year.
Are crypto gains subject to capital gains tax in Ireland?
Yes. The sale, exchange, or disposal of cryptocurrency is treated as a disposal of an asset, and the gain is chargeable to CGT at the standard 33% rate. Revenue has issued guidance confirming this treatment.
Does inheritance trigger capital gains tax?
No – inheritance is generally subject to Capital Acquisitions Tax, not CGT. The beneficiary inherits the asset at its market value on the date of death, and any gain from that point onward may be subject to CGT when the beneficiary later disposes of it.
What is the difference between ordinary income tax and CGT on property gains?
If you buy and sell properties as a trade (frequent transactions, with the intention of making profit), Revenue may treat the gains as trading income and tax them at your marginal income tax rate (up to 52%). If it is a one-off disposal of an investment property, it is a capital gain taxed at 33%.
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