Friends with benefits: 2 Irishmen to escape inheritance tax by getting married
Two male friends in Dublin plan to bypass Irish inheritance tax law through a marriage described as a “business” arrangement.
In Ireland, gifts or inheritance valued above a certain threshold are taxed at a rate of 33 percent. However, property or money received by a spouse or civil partner is exempt from the country’s Capital Acquisitions Tax.
As a result the men, who hail from the capital Dublin but are not partners, plan to tie the knot. In an interview with the state broadcaster RTE, the men explained their decision.
READ MORE: ‘Until a reboot do us part’: Japanese guys are marrying VR brides (VIDEO)
Matt, an 85-year-old pensioner, spoke of his intention to pass his possessions to his friend Michael when he dies. However, he doesn’t want his pal to get wrapped up in tax obligations, which is why the pair have planned a union based on “business.”
“He’s my best friend. He’ll be part of my life when I die and whatever I have, i.e. my home there’ll be no problems. He can have it. Maybe save some money,” Matt told the Liveline radio show.
Michael, who is divorced and has children including a 29-year-old daughter, later told the show he came up with the marriage idea after learning of the inheritance.
In Ireland, it has been legal for same-sex couples to enter into a civil partnership since 2010. A same-sex marriage law was enacted later in 2015 after a referendum. Michael indicated that although he loves Matt as a friend, the marriage is for tax purposes.
“I’ve known Matt for 29 years, the same amount of time as my own daughter. He lives in the same area where I grew up, in Stoneybatter. He’s one of the nicest people you will ever meet in your life,” Michael said.
READ MORE: ‘No one cares’: Backlash as Prince Harry announces he is about to marry a TV star
“What happened was Matt said to me, ‘I’m going to leave you the house.’ I said that’s a nice idea, but because of tax reasons I’d have to pay half of that to the government.” Hence the upcoming nuptials in 2018.
“Tax doesn’t go to a spouse. In other words with two partners, if one dies the house automatically goes to the partner.”
