L-R: Jim Hegarty, Ross Craigie, Deirdre Kirwin (Aviva), Kevin Kane (Aviva) and Trish Jukes


The lifetime transfer of an asset can give rise to a gift tax liability for the beneficiaries of the gift. To fund for this gift tax liability, you can endorse your Aviva Regular Saver policy under Section 73 of the Capital Acquisitions Tax Consolidation Act (CATCA) 2003. The benefit of using an Aviva Regular Saver policy to fund for a future gift tax liability is that if the qualifying conditions are met, the proceeds of the policy (to the extent used to pay the gift tax liability of the beneficiary) are exempt from CAT and will not increase the gift tax liability of the beneficiary.


Eamples of how the Aviva Regular Saver might work for you are as follows;

Paul wants to transfer ownership of a property worth €600,000 to his son Vincent in 8 years time


Vincent will have to pay the Revenue €92,400 in gift tax.

This will be payable on receipt of the gift of the property from Paul if Paul:

  1. sets up a Regular Saver with Aviva endorsed under section 73;
  2. funds the policy for a minimum of 8 years to cover the anticipated gift tax liability; and
  3. ensures that Revenue qualifying conditions are adhered to;

After 8 years Paul could use the policy proceeds to cover Vincent’s gift liability. If Paul decided to give Vincent the €92,400 from his bank account (or any other savings policy) then this would increase Vincent’s gift tax liability.

Saving for gift tax with a Deposit Account

If you give your beneficiaries additional money to pay the gift tax liability from yout bank account, this is seen by the Revenue as an additional gift, which will increase the beneficiaries’ tax liability.


Some of the qualifying conditions of section 73 endorsements are:

  • The life insured, and policy holder must be the same person, jointly owned policies will only qualify for endorsement under section 73 where the joint owners are a married couple or registered civil partners. The premiums must be paid by the policyholder. The Aviva Regular Saver is written on a joint life second death basis.
  • The policy must specify that it has been effected under section 73 from the outset. You cannot add the endorsement to existing Aviva Regular Saver policies.
  • Premiums must be paid annually (including a derivative of an annual premium such as monthly premiums) for a minimum of 8 years. The net premium (the annual premium in any continuous twelve-month period less any benefit received from the policy e.g. a partial encashment) must not vary any more than 50% of the initial annual premium.
  • On encashment, if all Revenue qualifying conditions have been adhered to, the policy proceeds will be exempt from gift tax when used to pay gift tax on a lifetime gift made within one year of the policy being encashed.

The policyholder is under no obligation to use the proceeds of their Aviva Regular Saver policy that has been endorsed under section 73 for the payment of gift tax making this a flexible succession planning option for client.

Should you require further information on the Aviva Regular Saver, we are happy to go through them with you. For more information please contact our office on (01) 4972544.