In Ireland, there are specific tax reliefs available for transferring a family farm. They are particularly aimed at encouraging the succession of family farms and ensuring their continuity. One significant relief is the Agricultural Relief, which can help reduce the tax liability associated with transferring farm assets.
Agricultural Relief: Agricultural Relief provides a significant reduction in the value of agricultural property for inheritance tax (Capital Acquisitions Tax – CAT) purposes. This means that the taxable value of qualifying agricultural property is reduced by 90% for CAT purposes. This relief is intended to facilitate the transfer of farms between family members. For example, reducing the tax burden associated with inheritance or gifts.
In order to qualify for Agriculture Relief, specific criteria must be met:
- The transfer must involve agricultural property, such as land, buildings, and certain types of farm assets.
- The transfer must be made to a “farmer,” broadly defined as someone who spends a substantial amount of their time farming.
- The property must be actively farmed for at least six years after the transfer.
- The transferor and the transferee must be relatives, typically within certain specified relationships, such as parent-child or grandparent-grandchild.
In Ireland, the transferring of the family farm down to younger generations a cherished tradition, a bond between generations, and a commitment to the land’s legacy. We want to help you do it the right way.
For any queries, feel free to contact us here.