CGT Qs re allowable expenses

Veeemcee

I am the executor dealing with the estate of my late sister (call her Dara, RIP) who passed away in early 2022. After years of headaches, the sale of a portion of agricultural land (approx. 3 ha) which Dara had inherited decades ago, was completed the month before she died and payment was received.

I am now calculating the CGT payable by her estate & will later have to to submit a CG1 Form. I have 2 queries where I really need some help, please. I sent these Qs to Revenue but so far no reply and payment deadline is coming up.

1) A small portion of the land sold by Dara had been inherited from another sibling, upon the death of the latter in 2013. CAT was fully paid up. I’m wondering if S.604A Relief can be applied to reduce the chargeable gain on the portion which Dara inherited from her deceased sibling, i.e. Property acquired between 7 December 2011 and 31 December 2014.

2). Do any of you have any experience about how Revenue considers expenses for farm improvement? The installation of fencing all along the farm boundaries was arranged and paid for by Dara (I came across a hefty receipt). Would CGT people accept this under what they call ‘Enhancement Expenditure’?

On a different note - anybody worked with the new SA2 Probate Form? I had become familiar with the old CA-24 form and had a filled-in sample from my other sibling. But no, they came up with this newbie. Just when I thought things would be easy!

Thank you in advance for any help with all of this.

Taxes

I believe the purpose of s.604a was to stimulate activity in the property market post-crash but it has broad applicability i.e. provision is not just confined to property developers/investors.

Reading s604a and, on the condition that CAT was paid based on the Market Value price of the land when originally acquired(by way of inheritance) by your sister, I cannot see any reason why the relief would not apply based on the information supplied by you.

What constitutes enhancement expenditure - Are you likely to pass such costs on to a potential seller i.e. include them in the sales price? If the answer is yes, I’d include such costs as enhancement expenditure.

Veeemcee

Thank you, Taxes, for your clear reply to my CGT questions. I will go ahead and include both deductions, as you suggest since this was my own best guess. Very best wishes.