Quick Tax question: Agricultural Relief

jooksavage

I'm in the process of taking over the family farm. I'm well-versed in stamp duty requirements but I have a quick question about CAT and specifically the agricultural relief that offsets 90% of the market value of the transferred land.

I work 38 hours a week in my full-time job. I spend an average of 3 hours each weekday working the farm. I also put in a minimum of 8 hours on the weekend so my average time spent on the farm each week is at least 23 hours. As this constitutes more than 50% of the time I spend at my full-time job, I would have assumed I am meeting the "active farmer" requirement (I'm currently wintering 70 bullocks). My accountant is similarly satisfied that I meet this requirement. HOWEVER... a friend of mine in a similar position has cautioned that he has given up his full-time employment on the advice of his accountant as it would interfere with his status as an "active farmer" and he would lose the agricultural relief on his recently inherited property. He also believes that I face a similar predicament.

As I said, my own accountant thinks this is patent nonsense and anything I've read would indicate that my current working arrangement satisfies the "active farmer" requirement.

Thoughts?

(edit: the other requirements - 80% asset rule and the property as "agricural land" stipulation - are being met)

Lockedout2

Do you not have a green cert?

20 hours per week seems to be fine. Just make sure it is in fact 20!

https://www.revenue.ie/en/tax-professionals/tdm/capital-acquisitions-tax/cat-part11.pdf

Cavanjack

jooksavage wrote: »

I'm in the process of taking over the family farm. I'm well-versed in stamp duty requirements but I have a quick question about CAT and specifically the agricultural relief that offsets 90% of the market value of the transferred land.

I work 38 hours a week in my full-time job. I spend an average of 3 hours each weekday working the farm. I also put in a minimum of 8 hours on the weekend so my average time spent on the farm each week is at least 23 hours. As this constitutes more than 50% of the time I spend at my full-time job, I would have assumed I am meeting the "active farmer" requirement (I'm currently wintering 70 bullocks). My accountant is similarly satisfied that I meet this requirement. HOWEVER... a friend of mine in a similar position has cautioned that he has given up his full-time employment on the advice of his accountant as it would interfere with his status as an "active farmer" and he would lose the agricultural relief on his recently inherited property. He also believes that I face a similar predicament.

As I said, my own accountant thinks this is patent nonsense and anything I've read would indicate that my current working arrangement satisfies the "active farmer" requirement.

Thoughts?

(edit: the other requirements - 80% asset rule and the property as "agricural land" stipulation - are being met)

I'm not much use to You but as far as I can see He needs to get another accountant. You don't.

jooksavage

Lockedout2 wrote: »

Do you not have a green cert?

20 hours per week seems to be fine. Just make sure it is in fact 20!

https://www.revenue.ie/en/tax-professionals/tdm/capital-acquisitions-tax/cat-part11.pdf

Yup did it last year but there such a backlog with the verification that it could be september before the bloody thing is issued.

J.O. Farmer

jooksavage wrote: »

Yup did it last year but there such a backlog with the verification that it could be september before the bloody thing is issued.

As per section 5.2.4 from the revenue guidance you have 4 years from the date of gift or inheritance to get the green cert so you should be fine without meeting the 50% requirement.


5.2.4 Agricultural qualifications
A beneficiary or a lessee, who does not farm the agricultural property for at least 50%
of his or her normal working time, must have an agricultural qualification (for
example, awarded by Teagasc) of the kind listed in Schedule 2, 2A or 2B of the
Stamp Duties Consolidation Act 1999 in relation to stamp duty relief on transfers of
farms to ‘young trained farmers’. If not already held, the qualification must be
achieved within the period of 4 years commencing on the date of the gift or
inheritance

jooksavage

J.O. Farmer wrote: »

As per section 5.2.4 from the revenue guidance you have 4 years from the date of gift or inheritance to get the green cert so you should be fine without meeting the 50% requirement.


5.2.4 Agricultural qualifications
A beneficiary or a lessee, who does not farm the agricultural property for at least 50%
of his or her normal working time, must have an agricultural qualification (for
example, awarded by Teagasc) of the kind listed in Schedule 2, 2A or 2B of the
Stamp Duties Consolidation Act 1999 in relation to stamp duty relief on transfers of
farms to ‘young trained farmers’. If not already held, the qualification must be
achieved within the period of 4 years commencing on the date of the gift or
inheritance

Thanks lads.

Again, this is exactly the stuff I've been reading and I was absolutely certain that, between the time I spend on the farm and the yet-to-be-awarded Green cert, I'd be covered. The other chap is so insistent that he had to leave his full-time job that it kind of threw me.

Thanks again!

roosterman71

Whats the best way of going about getting the green cert. I've done a year in Ag college (98/99), and then went off to normal college and got a degree and am working full time. How do ya go about the cert in these instances?

jooksavage

roosterman71 wrote: »

Whats the best way of going about getting the green cert. I've done a year in Ag college (98/99), and then went off to normal college and got a degree and am working full time. How do ya go about the cert in these instances?

I'd say get in touch with local Teagasc office. I did the Distance Learning course - took around 18 months. There was 1 block week near the start, after that there was approx 1 Friday every month and about 4 Saturdays with sit-down exams.

18 months might sound like a lot but I have heard they're changing the format of the distance learning course to make it even longer.

roosterman71

jooksavage wrote: »

I'd say get in touch with local Teagasc office. I did the Distance Learning course - took around 18 months. There was 1 block week near the start, after that there was approx 1 Friday every month and about 4 Saturdays with sit-down exams.

18 months might sound like a lot but I have heard they're changing the format of the distance learning course to make it even longer.

Yeah I rang my local Teagasc office, but they wouldn't talk unless I became a member

jooksavage

roosterman71 wrote: »

Yeah I rang my local Teagasc office, but they wouldn't talk unless I became a member

Whaaat?! That's insane. Where are you based? That's not the way any Teagasc office I've encountered works.

roosterman71

jooksavage wrote: »

Whaaat?! That's insane. Where are you based? That's not the way any Teagasc office I've encountered works.

I rang the Portlaoise crowd and was speaking to a girl on the phone. I told her why I was ringing and she told me to wait. She went and asked someone else about it and they told her that I had to be a member of Teagasc, and to go to my solicitor/accountant to get the info I need

jooksavage

roosterman71 wrote: »

I rang the Portlaoise crowd and was speaking to a girl on the phone. I told her why I was ringing and she told me to wait. She went and asked someone else about it and they told her that I had to be a member of Teagasc, and to go to my solicitor/accountant to get the info I need

If it's advice you're after, they probably will fob you off if you're not a member. If it's about getting info on a course, they have to help. It all depends on who you meet on the day I suppose. I'd say try again - most of the of the staff in our local office are sound heads and are more than happy to give info.

jooksavage

Also, this is probably the best time of the year to go applying - seems like a lot of the distance learning courses start in April/May so you'll want your name on that list shortly. They might give you the "all courses are oversubscribed" line that I got but in the end I was offered 3 different places so don't heed that bull****.