Will I be classified as a farmer?

mullinr2

Some help here needed. My dad is a farmer, well he used to be, now about 150 acres is forestry and the remaining 30 acres he rents out.
I was just wondering will I qualify as a farmer since I am a farmers son. I plan to get more involved with the forestry management as there will be thinnings on the way over the next few years and in 15-20 years some clearfell.
My reason for asking is because of inheritance tax. I do not want to be left with a huge inheritance tax bill once my parents go. I freaked out because the land is probably worth over a million at least. It Is very good agricultural land - no bogs!
Will I qualify as a farmer for the purposes of Agricultural Relief?
Do you now have to do a teasagc course to be classed as a farmer. My dad said he classified as a farmer because he was a farmer's son. I looked it up that if your land is under forestry your still classed as a farmer.

lakill Farm

speak to a forestry expert
a solicitor
an accountant/tax consultant
and an agri advisor

mullinr2 wrote: »

Some help here needed. My dad is a farmer, well he used to be, now about 150 acres is forestry and the remaining 30 acres he rents out.
I was just wondering will I qualify as a farmer since I am a farmers son. I plan to get more involved with the forestry management as there will be thinnings on the way over the next few years and in 15-20 years some clearfell.
My reason for asking is because of inheritance tax. I do not want to be left with a huge inheritance tax bill once my parents go. I freaked out because the land is probably worth over a million at least. It Is very good agricultural land - no bogs!
Will I qualify as a farmer for the purposes of Agricultural Relief?
Do you now have to do a teasagc course to be classed as a farmer. My dad said he classified as a farmer because he was a farmer's son. I looked it up that if your land is under forestry your still classed as a farmer.

Future Farmer

Why did he plant it?

I think it is terrible seeing good ground being planted.

Contact teagasc - you will probably need green cert....

mullinr2

Future Farmer wrote: »

Why did he plant it?

I think it is terrible seeing good ground being planted.

Contact teagasc - you will probably need green cert....

He planted it because he just had enough of farming and the uncertainty over it. Plus 20 year premiums tax free was a nice incentive.
The thing is I dont plan do a green cert. Im a qualified secondary school teacher and dont plan to go back to college. Will I not qualify as a farmer since my dad is still technically one?

Future Farmer

mullinr2 wrote: »

He planted it because he just had enough of farming and the uncertainty over it. Plus 20 year premiums tax free was a nice incentive.
The thing is I dont plan do a green cert. Im a qualified secondary school teacher and dont plan to go back to college. Will I not qualify as a farmer since my dad is still technically one?

No you won't you'll need to do the course to be honest it is easy doesn't take long, 2 nights a month for two years and a few projects, I think. Fetac 5 & 6.

Reggie.

Future Farmer wrote: »

No you won't you'll need to do the course to be honest it is easy doesn't take long, 2 nights a month for two years and a few projects, I think. Fetac 5 & 6.

Do you still need the green cert if you have a herd number and farming a small holding already for the same reasons as the OP

Future Farmer

Reggie. wrote: »

Do you still need the green cert if you have a herd number and farming a small holding already for the same reasons as the OP

OP?

You need it for the Stamp Duty....

Reggie.

Future Farmer wrote: »

OP?

You need it for the Stamp Duty....

Original Poster...OP

right just thinking for the future here. I already have a herd number and farming just thought I might get away from having to do the green cert

Future Farmer

http://www.boards.ie/vbulletin/showthread.php?t=2056935210

Wheelinone

Hi. I'm a farmer. I did a year in agricultural college and after thst a 48 hr course over a few days then following that a 3 month work placement. Also had to do an indept project on a topic of my choice plus a few other small bits and pieces. If I didn't id be a landowner. I'm sorry but you can't have it evey way. I would love to be a secondary teacher with all the perks but I'm sure there's some course to do to qualify. And I don't have the time to do courses because I'm a dairy farmer.

nashmach

For inheritance tax purposes, more information on your assets is needed but it is quite possible it will be okay.

You need a certain proportion of your assets post transfer to be non agg to claim the (current) 90% tax relief.

Only use at the moment the green cert will be to you is for Stamp Duty purposes.

mullinr2

nashmach wrote: »

For inheritance tax purposes, more information on your assets is needed but it is quite possible it will be okay.

You need a certain proportion of your assets post transfer to be non agg to claim the (current) 90% tax relief.

Only use at the moment the green cert will be to you is for Stamp Duty purposes.

Stamp duty is not what im worried about its the inheritance tax. The farm has roughly 180 acres with 150 under forestry and the rest is good pasture (rented for now). There is a decent size farm shed and that's it. No machinery and no livestock for now, although he was talking about doing some pig farming in years to come.

nashmach

mullinr2 wrote: »

Stamp duty is not what im worried about its the inheritance tax. The farm has roughly 180 acres with 150 under forestry and the rest is good pasture (rented for now). There is a decent size farm shed and that's it. No machinery and no livestock for now, although he was talking about doing some pig farming in years to come.

Your assets are just as important and not just the farm assets.

Really you need to go talk to an accountant.

Oldtree

Would the op also need tax records indicating continuous farming had been carried out, over the last number of years prior to claiming "inheriting from a farmer"?

Would he be better off farming the rented lands from now on under his fathers herd number or does renting out lands count as farming for revenue purposes?

mullinr2

So basically unless I start really to look into things, God forbid something happened in the near future, I will be left with a mountain of debt.

nashmach

mullinr2 wrote: »

So basically unless I start really to look into things, God forbid something happened in the near future, I will be left with a mountain of debt.

No.

Look up agriculture relief and see yourself.

freyners

To claim argi relief on inheritances you need 80% of your assets to comprise of farming assets once the inheritance comes through. If you own 200k worth of assets (House, car, cash on desposit), you would need to inherit 800k of farming assets (stock, farm buildings including farm house, machinery) to qualify for the relief.

Revenue leaflet here
http://www.revenue.ie/en/tax/cat/leaflets/cat5.html


you would need to speak to a qualified tax advisor tbh

smokey-fitz

This is something I looked into a while ago.
You wont get hit with inheritance tax depending on your personal situation, ie: if your own a house outright worth maybe 300k you will be taxed a certain amount. So basically it depends on your own wealth. If you own nothing of major value ie: property or land, I dont think you have anything to worry about.
Also there is a very high tax free threshold on inheritance of land between parent and son/daughter.

If you go onto the revenue website you will find the info you need, a solicitor will comfirm this also.

A green cert will enable your father to transfere the farm to you with stamp duty exempt.

Stamp duty is exempt on inheritance also, but as the years go on these can all change.

mullinr2

smokey-fitz wrote: »

This is something I looked into a while ago.
You wont get hit with inheritance tax depending on your personal situation, ie: if your own a house outright worth maybe 300k you will be taxed a certain amount. So basically it depends on your own wealth. If you own nothing of major value ie: property or land, I dont think you have anything to worry about.
Also there is a very high tax free threshold on inheritance of land between parent and son/daughter.

If you go onto the revenue website you will find the info you need, a solicitor will comfirm this also.

A green cert will enable your father to transfere the farm to you with stamp duty exempt.

Stamp duty is exempt on inheritance also, but as the years go on these can all change.

Just bought a house.its worth 150000. Other than that I dont have any other major assets.
So you dont have to do those fetac courses to qualify for agricultural relief.
Ill pop into revenue and talk to a solicitor about it

smokey-fitz

mullinr2 wrote: »

Just bought a house.its worth 150000. Other than that I dont have any other major assets.
So you dont have to do those fetac courses to qualify for agricultural relief.
Ill pop into revenue and talk to a solicitor about it

As far as I know a condition for the relief is you have to keep the inherited land for 5 or 6 years. If you sell the land within the time frame then you are liable to pay the full amount of tax.

Figures and numbers I quote wouldnt be accurate because its a year or so when I looked into it. The best thing to do is contact your solicitor and he/she will tell you the current legislation. The revenue website has the info too

mullinr2

Personally I would love if they just sold the land. If they dont after the six years is up I prob will. Im sure there are companies out there that would want to buy forestry to keep carbon emissions done. We shall see.

Oldtree

It would be aful if you had to sell the some of the family farm to service a tax debt. Take the advice from the above posters and get professional advice sooner rather than later.

lakill Farm

mullinr2 wrote: »

Just bought a house.its worth 150000. Other than that I dont have any other major assets.
So you dont have to do those fetac courses to qualify for agricultural relief.
Ill pop into revenue and talk to a solicitor about it

Why would you talk to Revenue? They will not advice you the best plans to save your tax exposure. Talk to someone who would work for you.

If you inherit the land you will pay no stamp duty

If the land is transferred to you (ie before your fathers passing) and you are elligible for Agri relief stamp duty will be 1% reduced from 2%

There are CGT & CAT implications to look at also

Also you and your parents will need 2 seperate solicitors.

mullinr2

Talked to my solicitor. There is nothing I can do except to keep my own assets down so everything from house to savings will be in my wife's name. He also advised me to get my parents to talk to their accountant and/or tax lawyer.

He informed me that when the IMF were in town they wanted away with agricultural relief. Them bastards!

Reggie.

mullinr2 wrote: »

Talked to my solicitor. There is nothing I can do except to keep my own assets down so everything from house to savings will be in my wife's name. He also advised me to get my parents to talk to their accountant and/or tax lawyer.

He informed me that when the IMF were in town they wanted away with agricultural relief. Them bastards!

Hardly surprising

newholland

lakill Farm wrote: »

Why would you talk to Revenue? They will not advice you the best plans to save your tax exposure. Talk to someone who would work for you.

If you inherit the land you will pay no stamp duty

If the land is transferred to you (ie before your fathers passing) and you are elligible for Agri relief stamp duty will be 1% reduced from 2%

There are CGT & CAT implications to look at also

Also you and your parents will need 2 seperate solicitors.

Your stamp duty quote above is incorrect the stamp duty is separate from agri relief. It is reduced to 1% in father son transaction regardless of agri relief.

You can take mortgage on principal residence away from house to give net asset value.

If you do no qualify for agri relief you will for business relief as long as u meet these conditions.

freyners

newholland wrote: »

Your stamp duty quote above is incorrect the stamp duty is separate from agri relief. It is reduced to 1% in father son transaction regardless of agri relief.

You can take mortgage on principal residence away from house to give net asset value.

If you do no qualify for agri relief you will for business relief as long as u meet these conditions.

Just an aside, the stmap duty relief is consanguinity relief, this is being phased out by the end of this year
http://www.citizensinformation.ie/en/housing/owning_a_home/buying_a_home/stamp_duty.html