solar lease taxes

liam00

Hi
Im new to all of this like some others ,im just wondering what tax would be paid on leasing land to solar energy company,rent would be 56000 per year,is their any way around paying high rate of 40%,my wages would be 45k and wife is at home .ive no entitlements as land is not in my name yet.

ganmo

It would be treated as any non paye income
You could go for a joint assessment with your wife.

How can you lease out the ground if it isn't in your name?

lakill Farm

liam00 wrote: »

Hi
Im new to all of this like some others ,im just wondering what tax would be paid on leasing land to solar energy company,rent would be 56000 per year,is their any way around paying high rate of 40%,my wages would be 45k and wife is at home .ive no entitlements as land is not in my name yet.

You could invest it into a pension fund.?

or set up a company and have options and leasing grants between you, company, land owner and the solar panel company

liam00

The land will go into my name shortly,hopefully.

lakill Farm

liam00 wrote: »

The land will go into my name shortly,hopefully.

there are ways to reduce it alright

Sam Kade

liam00 wrote: »

Hi
Im new to all of this like some others ,im just wondering what tax would be paid on leasing land to solar energy company,rent would be 56000 per year,is their any way around paying high rate of 40%,my wages would be 45k and wife is at home .ive no entitlements as land is not in my name yet.

How much land are you leasing? Sounds enticing.

RightTurnClyde

lakill Farm wrote: »

there are ways to reduce it alright

If the land was transferred into a company wouldn't by be more advantageous to him ????

RightTurnClyde

liam00 wrote: »

Hi
Im new to all of this like some others ,im just wondering what tax would be paid on leasing land to solar energy company,rent would be 56000 per year,is their any way around paying high rate of 40%,my wages would be 45k and wife is at home .ive no entitlements as land is not in my name yet.

If you don't mind me asking, what's the rate per acre.

Birdnuts

liam00 wrote: »

Hi
Im new to all of this like some others ,im just wondering what tax would be paid on leasing land to solar energy company,rent would be 56000 per year,is their any way around paying high rate of 40%,my wages would be 45k and wife is at home .ive no entitlements as land is not in my name yet.

There was a piece on this in this weeks Irish Examiner. It mentioned a tax rate of 50%, plus you will not get any BPS or any other entitlements on land that is leased out in this way as it is then deemed non croppable or grazeable. In any case I'd be a bit wary of assuming any future earnings in this area or signing leases at this stage since none of these solar farms will be built without hefty government subsidies - currently none are available and a decision on whether any will be in the future will not be made until next year at the earliest following a feasibility study by the Department of Energy. If a scheme is introduced, what farms will get built will depend on the level of supports availiable, proximity to local substations etc.

liam00

they are paying 1250 per acre.has planning and beside substation .just waiting for refit tarrif and grid connection.

Green farmer

Not being smart, but for that type of income from the land I'd be talking to a tax specialist to structure things correctly.

liam00

thanks ,thats what i was thinking ,

cargo

liam00 wrote: »

they are paying 1250 per acre.has planning and beside substation .just waiting for refit tarrif and grid connection.

That's big money. I heard between 700 and 900 for a few sites up the country. Do you mind me asking where roughly are you? Are you on the south coast (cork) or over into the SE corner (Wexford)? I assume they would be the areas with best sunlight so might command a few more pound than land further up North.

liam00

in wexford,i think some of the farmers in better areas are being offerd 1500 an acre,and 5000 to put sheep on it to keep grass down to prevent shading

lakill Farm

RightTurnClyde wrote: »

If the land was transferred into a company wouldn't by be more advantageous to him ????

No No NO



If he ever sold the land he would be hit with double taxation

lakill Farm

Green farmer wrote: »

Not being smart, but for that type of income from the land I'd be talking to a tax specialist to structure things correctly.

You don't think most accountant has relevant tax expertise to put together a tax efficient structure?

Its just options, land lease and some tax planning

:rolleyes:

Green farmer

lakill Farm wrote: »

You don't think most accountant has relevant tax expertise to put together a tax efficient structure?

Its just options, land lease and some tax planning

:rolleyes:

To be honest, tax is a specialised area of accountancy. Might be worth a few quid getting it right before you start. I meant to say an accountant that would have adequate tax experience.

Birdnuts

liam00 wrote: »

they are paying 1250 per acre.has planning and beside substation .just waiting for refit tarrif and grid connection.

The REFIT tariff was the subsidy I mentioned in my earlier post and it is by far the most important factor as to whether any of these projects get off the ground or not. Whatever the Dept of Energy announces on the subject of supporting solar energy next year in terms of these tariffs(that's assuming they will actually move to support solar), they will have to be substantial to make these solar farms viable. The level of this tariff will be critical as to which solar farms actually get built, so there is still some uncertainty there despite what these solar companies appear to be telling landowners. Some were initially claiming that land under solar farms still attracted entitlements, but it is clear now that this will not be the case after a recent announcement by the Minister on the subject as reported in the IFJ a few weeks back

Jack180570

Birdnuts wrote: »

The REFIT tariff was the subsidy I mentioned in my earlier post and it is by far the most important factor as to whether any of these projects get off the ground or not. Whatever the Dept of Energy announces on the subject of supporting solar energy next year in terms of these tariffs(that's assuming they will actually move to support solar), they will have to be substantial to make these solar farms viable. The level of this tariff will be critical as to which solar farms actually get built, so there is still some uncertainty there despite what these solar companies appear to be telling landowners. Some were initially claiming that land under solar farms still attracted entitlements, but it is clear now that this will not be the case after a recent announcement by the Minister on the subject as reported in the IFJ a few weeks back

Im not 100% sure but my understanding was that if 50% of the area was grass then the landowner would be entitled to draw BPS on the 50% that was not covered in solar panels (as long as he did not lease out this land to the solar company).
Like previous posters said, this is an area that requires specialist advice. That is advice from a tax consultant that specialises in the area of solar farms.
Also as previously noted, neither the supports for solar farms nor the tax rules are fully set out yet and there may be (most likely will be) changes.

Green farmer

Seen a programme on the bbc , where your man had the solar panels and the sheep in grazing underneath them. Two incomes from one parcel of land

bullnuts

Do they need foundation or just like posts driven in the ground? A lot less invasive than turbines id say ! And faster constructed? Would they be suitable on boggy ground?