The High Court upheld the Tax Appeals Commission’s determination that Leanne Deane was not beneficially entitled to interests in other homes on the date she inherited her family home, for the purposes of the dwelling house tax exemption.
The court answered six questions of law in the Commission’s favour in a case stated under the Taxes Consolidation Act 1997. It did not decide a seventh question about what “at the date of the inheritance” means at different times within that day, saying an answer was unnecessary to dispose of the case.
Deane had lived in the family home since childhood, including for the three years before her father’s death and for six years afterwards. Under her father’s will, she and her brother were to receive his property in equal shares. A family arrangement later allocated the home to Deane and a business and business premises to her brother. Deane also inherited half interests in four other residential properties, three in Ireland and one in Spain.
The central issue was whether Deane had an interest in those other homes on 27 October 2010, the date of her father’s death and the date of inheritance under the tax legislation. The net estate was not established until 29 March 2011.
The Revenue Commissioners argued that Deane had an interest in the other homes from the date of death, including through her interest in the proper administration of the estate. The court rejected that argument. It said a residuary beneficiary does not become beneficially entitled to particular assets in the residue until the estate’s net value is established. An interest in the administration of an estate is distinct from an interest in a dwelling house or an interest in land.
The court also agreed that the exemption law did not require Deane to be beneficially entitled to the family home on the date of inheritance. The statutory conditions instead included qualifying residence before the inheritance and continued occupation for six years afterwards. Deane had in fact inherited the family home, the court said, but her beneficial entitlement arose after the date of inheritance.
The judgment concerns the legal questions referred by the Commission. The court remitted the matter to the Commission with its opinion, as required for a case stated; the judgment does not itself set out a separate tax assessment or payment order.