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forestry investment?

  • 22-03-2016 9:52pm
    #1
    doniemaca
    Registered Users Posts: 10 ✭


    I recently had a lump sum investment that matured,now that bank term deposits are at rock bottom I was looking for something to take a chance on.I've seen a lot of advertising on investing in the Irish forestry sector. Is there anyone out there that has recently entered this market that could advise ....?


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Comments

  • #2
    Harry Palmr
    Closed Accounts Posts: 40,061 ✭✭✭✭Harry Palmr


    Stay clear! Stay very clear.

    I'll point you to this thread http://www.askaboutmoney.com/threads/investment-in-irish-forestry-funds.6699/page-13#post-1456078.


  • #3
    newacc2015
    Closed Accounts Posts: 2,379 ✭✭✭newacc2015


    AFAIK and I could be wrong. Forestry was a tax avoidance scheme heavily pushed by Anglo Irish Bank. One of the schemes was 90% Anglo customers for tax purposes.

    Irish timber is pretty horrific. Evergreen tree grow too quick in this country and a result the wood is twisted. If you go to any building provider, Russian timber is grade 1 and Irish timber is grade 2


  • #4
    doniemaca
    Registered Users Posts: 10 ✭doniemaca


    newacc2015 wrote: »
    AFAIK and I could be wrong. Forestry was a tax avoidance scheme heavily pushed by Anglo Irish Bank. One of the schemes was 90% Anglo customers for tax purposes.

    Irish timber is pretty horrific. Evergreen tree grow too quick in this country and a result the wood is twisted. If you go to any building provider, Russian timber is grade 1 and Irish timber is grade 2

    Well that's enough about that !


  • #5
    John35h
    Registered Users Posts: 4 ✭John35h


    In relation to newacc2015 your statement is far from truth about Irish timber. when you refer to twists im assuming you mean knots that can alter the quality of structural timber but the majority commercial forestry that are managed properly will have minimized this risk in relation to tax avoidance schemes it is publicly published that is it a tax exempt industry to promote growth in the Irish forestry sector. As for the Irish forestry funds they were a Ponzi scheme from day one in my opinion coming from a seasoned forester the only people who benefited from them were the founders who were from financial backgrounds, And in response to doniemaca I would recommend forestry investment as a long term investment you will receive money from first second and subsequent thinning and clear-fell all tax free. There’s not such thing as a quick buck, If you do decide to invest in forestry I would advise you to purchase your own forestry so you would have it as an asset or establish a new forest which would be fully grant aided by the state.Many people have become very wealthy from forestry but its like anything you must have a strong understanding of how the industry operates you can just buy into an investment fund an expect strong returns it doesn't work like that.


  • #6
    Esel
    Registered Users Posts: 22,001 ✭✭✭✭Esel


    John35h wrote: »
    In relation to newacc2015 your statement is far from truth about Irish timber. when you refer to twists im assuming you mean knots that can alter the quality of structural timber but the majority commercial forestry that are managed properly will have minimized this risk in relation to tax avoidance schemes it is publicly published that is it a tax exempt industry to promote growth in the Irish forestry sector. As for the Irish forestry funds they were a Ponzi scheme from day one in my opinion coming from a seasoned forester the only people who benefited from them were the founders who were from financial backgrounds, And in response to doniemaca I would recommend forestry investment as a long term investment you will receive money from first second and subsequent thinning and clear-fell all tax free. There’s not such thing as a quick buck, If you do decide to invest in forestry I would advise you to purchase your own forestry so you would have it as an asset or establish a new forest which would be fully grant aided by the state.Many people have become very wealthy from forestry but its like anything you must have a strong understanding of how the industry operates you can just buy into an investment fund an expect strong returns it doesn't work like that.
    Never mind knots.

    What about proper spacing, and gaps before the headlands?

    Plant trees for your children - one of the things my father told me. He didn't.

    Trading timber is different.

    Christmas comes once a year.

    Retailers make most of the profit.

    Not your ornery onager



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  • #7
    John35h
    Registered Users Posts: 4 ✭John35h


    Esel wrote: »
    Never mind knots.

    What about proper spacing, and gaps before the headlands?

    Plant trees for your children - one of the things my father told me. He didn't.

    Trading timber is different.

    Christmas comes once a year.

    Retailers make most of the profit.


    Im not quite sure where you are coming from?I'm assuming you don't have any understanding of the forests service acts and regulations and that you most likely don't work in the industry and did not study forestry for at least 4 years.Furthermore if your trying to imply that a industry that employs 12,000 people and has an economic output of 3 billion euro a year doesn't make a profit then I can come to the conclusion that you are just voicing your opinion and not giving factual based evidence that was assisting the initial post in making a decision.


  • #8
    davidblack
    Registered Users Posts: 2 ✭davidblack


    What is Forestry actually? i could not understand and what effects it has at tax bankings?


  • #9
    John35h
    Registered Users Posts: 4 ✭John35h


    davidblack wrote: »
    What is Forestry actually? i could not understand and what effects it has at tax bankings?

    Forestry is many different things,but the money making part where all the investment from pension funds and private individuals is basically producing a commercial forestry stand for structural timber use. the main species that is used is sitka spruce and it ranges from 28-45 years to grow the trees.Its and tax exempt industry in ireland before the 2016 budget the maximum amount you could earn from timber sales in a year was 120,000,this year however you could earn 2 million and be tax exempt. Thats it in layman terms there's much more to it than that.the reason its tax exempt is 1 because in 1920 ireland had less than 1% forest land cover and in the last 80 odd years we have grown that to over 11% still far behind the eu average of around 30% and 2 it can take up to 40 years for timber to grow.


  • #10
    pesy
    Registered Users Posts: 17 ✭pesy


    John35h wrote: »
    davidblack wrote: »
    What is Forestry actually? i could not understand and what effects it has at tax bankings?

    Forestry is many different things,but the money making part where all the investment from pension funds and private individuals is basically producing a commercial forestry stand for structural timber use. the main species that is used is sitka spruce and it ranges from 28-45 years to grow the trees.Its and tax exempt industry in ireland before the 2016 budget the maximum amount you could earn from timber sales in a year was 120,000,this year however you could earn 2 million and be tax exempt. Thats it in layman terms there's much more to it than that.the reason its tax exempt is 1 because in 1920 ireland had less than 1% forest land cover and in the last 80 odd years we have grown that to over 11% still far behind the eu average of around 30% and 2 it can take up to 40 years for timber to grow.
    I'm also in the same position as the OP, and have been doing a lot of research, going over the afforestation scheme, and it all seems quite positive and a safe investment... my trouble is, in making an initial investment, how much forestry to buy...? What would you recommend to someone starting out?


  • #11
    John35h
    Registered Users Posts: 4 ✭John35h


    pesy wrote: »
    I'm also in the same position as the OP, and have been doing a lot of research, going over the afforestation scheme, and it all seems quite positive and a safe investment... my trouble is, in making an initial investment, how much forestry to buy...? What would you recommend to someone starting out?

    Well its complicated question to answer. Firstly if you have land then the afforestation scheme is a good bet, downside is it takes 25-40 years for timber to grow, depending on site conditions.(assuming the land is zoned for agricultural use and is not worth very much otherwise you would be better off selling it, because once you plant forestry you are not allowed to return it to normal farm land after a rotation)Secondly depends on your age and financial circumstances how much you are going to invest, if you’re thinking like 30,000-50,000 possibly afforestation schemes if its more then there is other options. You would have to consult with a registered forester before making any commitment. I would stay clear of investment schemes.


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  • #12
    rgossip30
    Registered Users Posts: 2,445 ✭✭✭rgossip30


    I am looking at an investment with WFS Ireland Ltd in Christmas trees in the UK . They claim that you buy a lease on the land hold for 8 years and the buy and sell is completed by them . The company is new May 2016 so no track record and its unregulated, seems risky .
    I would insist on the use of a recognised solicitor to complete the deal another area seems to bring up a red flag .


  • #13
    danger mouse 1
    Registered Users Posts: 11 ✭danger mouse 1


    Hello, I invested with WFS Ireland there recently. I checked them out as throughly as one can with company reg check and checked out there bank details with bank of Ireland and all seemed legit. Who were you speaking with in WFS Ireland and where did he say Christmas tree development would be ?


  • #14
    danger mouse 1
    Registered Users Posts: 11 ✭danger mouse 1


    Anyone else have any dealings with WFS Ireland ltd about Christmas tree farm investments in England ?


  • #15
    rgossip30
    Registered Users Posts: 2,445 ✭✭✭rgossip30


    danger mouse 1 wrote: »
    Hello, I invested with WFS Ireland there recently. I checked them out as throughly as one can with company reg check and checked out there bank details with bank of Ireland and all seemed legit. Who were you speaking with in WFS Ireland and where did he say Christmas tree development would be ?

    http://xmastreefarm.co.uk/ They seem legitimate I sent an e mail some time ago but no reply .WFS is only a new company I got the impression from the rep on the phone they had a track record ? The return on forestry is paltry .


  • #16
    newacc2015
    Closed Accounts Posts: 2,379 ✭✭✭newacc2015


    danger mouse 1 wrote: »
    Hello, I invested with WFS Ireland there recently. I checked them out as throughly as one can with company reg check and checked out there bank details with bank of Ireland and all seemed legit. Who were you speaking with in WFS Ireland and where did he say Christmas tree development would be ?

    They might be legit. But I would concerned with investing in a company where the person has limited business experience. The director of WFS has no previous directorship and only set the company up in May of this year.

    If you are investing in things like this, I would go for the EIIS scheme. At least if the business goes bust you still get your tax relief


  • #17
    danger mouse 1
    Registered Users Posts: 11 ✭danger mouse 1


    It's hard to know alright but if investment went bust with Eilis scheme you still lose your investment and getting tax relief would not be much compensation. I only made small investment with WFS so will see how it goes. There banking with bank of Ireland and checked them out and there is full investment insurance through bank of Ireland up to 50000 euro and contracts and lease agreements are all 100%. Will see how it goes there is not many investments that will give you back 8% per annum tax free and capital gains tax free for 5 to 8 year investment.


  • #18
    Nody
    Moderators, Category Moderators, Arts Moderators, Business & Finance Moderators, Entertainment Moderators, Society & Culture Moderators Posts: 18,258 CMod ✭✭✭✭Nody


    danger mouse 1 wrote: »
    It's hard to know alright but if investment went bust with Eilis scheme you still lose your investment and getting tax relief would not be much compensation. I only made small investment with WFS so will see how it goes. There banking with bank of Ireland and checked them out and there is full investment insurance through bank of Ireland up to 50000 euro and contracts and lease agreements are all 100%. Will see how it goes there is not many investments that will give you back 8% per annum tax free and capital gains tax free for 5 to 8 year investment.
    There's a reason for that and I'm betting you'll find out exactly why in this case as well. To good to be true etc.


  • #19
    danger mouse 1
    Registered Users Posts: 11 ✭danger mouse 1


    Sure will see how it goes 8% return is not massive but sure there is no such thing as risk free investment nowadays. Forestry is as far as I'm aware only thing that's tax free and capital gains tax free. Will let you know how investment goes in Feb or March when Christmas trees are being planted.


  • #20
    rgossip30
    Registered Users Posts: 2,445 ✭✭✭rgossip30


    danger mouse 1 wrote: »
    It's hard to know alright but if investment went bust with Eilis scheme you still lose your investment and getting tax relief would not be much compensation. I only made small investment with WFS so will see how it goes. There banking with bank of Ireland and checked them out and there is full investment insurance through bank of Ireland up to 50000 euro and contracts and lease agreements are all 100%. Will see how it goes there is not many investments that will give you back 8% per annum tax free and capital gains tax free for 5 to 8 year investment.

    Greenwood Forestry Management tried to claim they were regulated by the central bank and also had a Bank of Ireland account .This company is very risky and try to get you to invest in Brazilian forestry . They have addresses in Spain too .What always puzzles me is that such companies continue to trade regardless of bad publicity . I never see any feedback from investors on returns .

    http://www.boards.ie/vbulletin/showthread.php?t=2056339587 check out this thread .


  • #21
    rgossip30
    Registered Users Posts: 2,445 ✭✭✭rgossip30


    danger mouse 1 wrote: »
    Sure will see how it goes 8% return is not massive but sure there is no such thing as risk free investment nowadays. Forestry is as far as I'm aware only thing that's tax free and capital gains tax free. Will let you know how investment goes in Feb or March when Christmas trees are being planted.

    Do please .


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  • #22
    Cute Hoor
    Registered Users Posts: 1,788 ✭✭✭Cute Hoor


    danger mouse 1 wrote: »
    It's hard to know alright but if investment went bust with Eilis scheme you still lose your investment and getting tax relief would not be much compensation. I only made small investment with WFS so will see how it goes. There banking with bank of Ireland and checked them out and there is full investment insurance through bank of Ireland up to 50000 euro and contracts and lease agreements are all 100%. Will see how it goes there is not many investments that will give you back 8% per annum tax free and capital gains tax free for 5 to 8 year investment.

    With the EIIS the most of your investment that you can lose is 70%, and you get the 30% back within a couple of months of original investment. An EIIS investment in a wind farm will typically predict a return of 10% pa approx on your investment with the first 30% coming as I said in the first couple of months. The wind farm funding will generally come from the promoters (a relatively small %), EIIS investors (a larger %), and bank debt (by far the most significant %), so there are a number of entities with a vested interest in ensuring the success of the project. It's not without risk of course, what is, but a wind farm in Ireland (with significant tax benefits) sounds a lot more secure than christmas trees in Brazil. Each to their own though and the best of luck with it.


  • #23
    rgossip30
    Registered Users Posts: 2,445 ✭✭✭rgossip30


    Cute Hoor wrote: »
    With the EIIS the most of your investment that you can lose is 70%, and you get the 30% back within a couple of months of original investment. An EIIS investment in a wind farm will typically predict a return of 10% pa approx on your investment with the first 30% coming as I said in the first couple of months. The wind farm funding will generally come from the promoters (a relatively small %), EIIS investors (a larger %), and bank debt (by far the most significant %), so there are a number of entities with a vested interest in ensuring the success of the project. It's not without risk of course, what is, but a wind farm in Ireland (with significant tax benefits) sounds a lot more secure than christmas trees in Brazil. Each to their own though and the best of luck with it.

    You do have to feel suspicious when these payments come after a few months as most likely you are being paid from new investors .
    I have a Park First/Group First car park investment that is similar .


  • #24
    Cute Hoor
    Registered Users Posts: 1,788 ✭✭✭Cute Hoor


    rgossip30 wrote: »
    You do have to feel suspicious when these payments come after a few months as most likely you are being paid from new investors .
    I have a Park First/Group First car park investment that is similar .

    With the EIIS schemes, the 30% that you are getting back after a couple of months is from Revenue, the full amount of your investment remains invested in the EIIS business and there is no repayment from them until the term (5 years) is up. After 3 years you will get the remaining 10% back from Revenue, provided certain conditions have been met.


  • #25
    Baggio10
    Registered Users Posts: 2 ✭Baggio10


    Hey guys,

    Can someone answer this for me please. If you own forestry and the trees come to maturity and are for clear-fell you will receive a lumpsum for this which is currently tax free. Is this subject to change or if you buy the land, plant the trees etc while it is currently tax free do future governments have to honour that? Or in the future could the government introduce say a capital gains tax on the clear-fell lumpsum that you were relying on for your pension etc?

    Thanks


  • #26
    accidental forester
    Registered Users Posts: 69 ✭✭accidental forester


    Hi Baggio10,

    As no one has piped up on this I'll pass this along. If you purchase land that has forestry in receipt of premiums or plant under one of the schemes, you'll be signing a contract that will have to be honoured for the duration of that contract. For instance, the premium period for most categories was recently reduced from 20 to 15 years. If you were in the earlier scheme in years 16 through 20, your premiums continued. The terms for new plantations are at the whim of the current administration but existing contracts have to be honoured. That's the premium side.

    On the taxation side there is a little less certainty. The tax free benefits could be changed or withdrawn altogether in a future budget. However this is unlikely unless the government wants to see a complete collapse of future forestry plantation. If anything, the tax free benefits have been improved in the last few budgets.


  • #27
    Baggio10
    Registered Users Posts: 2 ✭Baggio10


    thanks for clear response.


  • #28
    Gijima
    Registered Users Posts: 69 ✭✭Gijima


    danger mouse 1 wrote: »
    Sure will see how it goes 8% return is not massive but sure there is no such thing as risk free investment nowadays. Forestry is as far as I'm aware only thing that's tax free and capital gains tax free. Will let you know how investment goes in Feb or March when Christmas trees are being planted.

    Hi,
    Just checking if u had any updates on your investment.

    Looks like there's a WFS registered in the UK, not sure if they part of WFS Ireland.


  • #29
    parforsa
    Registered Users Posts: 2 ✭parforsa


    No, the company in UK connected with WFS Ireland is Walker Forestry Services.
    I describe my experience with Avon Moss Developement (same directors) here:

    https://www.boards.ie/vbulletin//showthread.php?p=110041316


  • #30
    danger mouse 1
    Registered Users Posts: 11 ✭danger mouse 1


    hello, just to give quick update on my dealings with walker forestry services. I visited one of there christmas tree farms in wales last October. they had a car meet me at airport and drove me out to site where I met one of walker forestry people.
    site looked good and met a few other fellow irish investors there one of whom has recently received money back from walker forestry for investment in christmas trees.
    there lastest venture my jingle tree seems to be going very well so I have no doubts the company is good.
    I have met the owner in person in Dublin and is very contactable any time I have any queries. I currently have 15,000 euro invested with them and am expecting my first dividend payment back in January 22.


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  • #31
    Johndinvest
    Registered Users Posts: 4 ✭Johndinvest


    The company has also set up Walker Property Services producing Hemp in Africa, wpspropertyservices.com. The return offered is identical to their Christmas tree production which seems strange to me as they are two different plants with different end markets?


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