The sale of your family home is usually the largest financial transaction you will make. The good news is that Principal Private Residence (PPR) relief means the gain is often fully exempt from CGT. But there are situations where tax does apply.
If the property has been your only or main residence for the entire period of ownership, the gain is fully exempt under Section 604 TCA 1997.
If part of the property was rented out, used for business, or you were non-resident for part of the ownership, the exemption is proportional. The last 12 months of ownership always count as PPR use.
When you buy your next home, stamp duty applies at the standard rates (1% up to EUR 1 million, 2% from EUR 1 million to EUR 1.5 million, 6% above).
You owned a property for 10 years. For 7 years it was your home, and for 3 years it was rented out. The gain on sale is EUR 200,000. PPR exemption covers 7 years plus the final 12 months = 8 years out of 10. Taxable proportion: 2/10 = 20%. Taxable gain: EUR 200,000 x 20% = EUR 40,000. Less annual exemption: EUR 40,000 - EUR 1,270 = EUR 38,730. CGT: EUR 38,730 x 33% = EUR 12,780.90.
The PPR exemption extends to the garden and grounds of the property, up to one acre (including the site of the house). If the site exceeds one acre, the excess is treated as a separate asset and the gain on it is taxable.
If you transfer the family home to your spouse as part of a separation or divorce, the transfer is exempt from CGT (and stamp duty and CAT). However, the receiving spouse inherits your original base cost. If they later sell the property, they will pay CGT on the gain calculated from your original purchase price.
There is no specific tax relief for downsizing in Ireland. If you sell your PPR and buy a smaller home, the gain on the PPR sale is exempt (assuming full PPR relief), and stamp duty applies on the purchase of the new home at the standard rates.
Disclaimer: This information reflects the 2026 tax year. Tax rules change annually following the Budget. Check Revenue.ie for the latest rates and thresholds. This guide is for informational purposes only and does not constitute tax advice.