For help with transferring your farm or site, contact:
It can seem like a complicated process when transferring property from one person to another. At John A. Sinnott & Co. Solicitors, we can simplify the process for you and guide you through it. Some facts:
Parent to Child Gift
- Since December 2012, a parent can transfer agricultural property to the value of €225,000 tax free to their child.
- Capital Acquisitions Tax at 33% is payable on any surplus over €225000,unless you qualify for ‘reliefs’. See below.
Business Relief and Agricultural Relief
- At present, the person receiving the transfer of property is only assessed for tax purposes on 10% of the value of the business or farm.
Security for the Owner/Transferor
If you are transferring the property, we will discuss with you:
- What security will you have after making the transfer i.e. income and home
- How much to transfer
- Should part of the property be leased, instead of transferred.
- Are there pensions available to you
- The implications of death, divorce or separation of the transferee.
Capital Acquisitions Tax - Agricultural Relief
Relief on the Capital Acquisitions Tax that needs to be paid in the event of a farm transfer is currently available. Some further information below:
- It is agricultural land and property that determines if the relief applies - hence the danger of separating the farmhouse and other buildings from the land by separate transfers. The farmhouse etc., without the land, is not agricultural property. Therefore, if a farmhouse on its own is transferred to a farmer it will not qualify for agricultural relief.
- In general, the Revenue Commissioners consider that small parcels of land do not constitute agricultural property and do not qualify for agricultural relief. However, claims for relief are determined by the circumstances of each case on an individual basis.
- Crops, trees and underwood growing on agricultural land qualify for agricultural relief. However, crops or trees that have been harvested or cut down do not qualify.
- Farm machinery, livestock and bloodstock physically situated on agricultural land qualify for agricultural relief. Such assets owned, however, by a dealer and not situated on any agricultural land would not qualify for agricultural relief but may qualify instead for Business relief.
- The Revenue Commissioners accept that any interest, which a beneficiary may have, in a pension or pension fund can be ignored when calculating whether a beneficiary meets the 80% agricultural assets farmer test.
- The 80% agricultural assets "farmer" test is applied at the Valuation Date of the gift or inheritance. The Valuation Date in a case of a gift is the date the gift takes place. The Valuation Date in the case of an inheritance is normally the Date the Grant of Probate or the Grant of Administration issues in the estate.
- Agricultural relief is clawed back where the agricultural property is disposed of or compulsorily acquired within six years of the gift or inheritance and the proceeds are not reinvested in other agricultural property within one year of the sale or within six years of the compulsory purchase. It is not necessary that reinvestment is made in the same type of agricultural property.