Entitlements

Business Idea · 29-07-2020 11:42am #1

Hi I'm applying for the young farmers scheme next year but don't qualify for the national reserve due to off-farm income limits. Whats the best way to get entitlements, or how do i go about it at all?

The11Duff · 29-07-2020 11:48am

If you can't apply to the national reserve, then you will have to buy or lease them in. Lease preferably because with new CAP you don't know what will happen them.

Business Idea · 29-07-2020 11:53am

The11Duff wrote: »

If you can't apply to the national reserve, then you will have to buy or lease them in. Lease preferably because with new CAP you don't know what will happen them.

Thanks for the quick reply. What kind of money are they making to lease? Dunno if it would be worth my while if most of the BPS will be gone on leasing entitlements

emaherx · 29-07-2020 11:58am

they are leased out at about 98% of their worth.
you basically give the value of the entilement to the owner and you get the greening payment. Will work out at you paying between 60% and 70% of the gross value.

entitlments vary significatly in value.

Hard Knocks · 29-07-2020 12:21pm

Business Idea wrote: »

Thanks for the quick reply. What kind of money are they making to lease? Dunno if it would be worth my while if most of the BPS will be gone on leasing entitlements

We leased for 2 years and then bought
At spring time look out for adds from HMG and
Joseph Naughton, both are excellent to deal with
The value of the entitlement can effect the price

Business Idea · 29-07-2020 12:32pm

Hard Knocks wrote: »

We leased for 2 years and then bought
At spring time look out for adds from HMG and
Joseph Naughton, both are excellent to deal with
The value of the entitlement can effect the price

Thanks again. I'll have to think well about it, 20/30 acres of good enough land and access to commanage, so I'm not sure itd be worth my while.

J.O. Farmer · 29-07-2020 2:40pm

Business Idea wrote: »

Thanks again. I'll have to think well about it, 20/30 acres of good enough land and access to commanage, so I'm not sure itd be worth my while.

It's very much worth your while with the YFS. You need entitlements to get the young Farmers top up. Without it the value might be more limited but with the new CAP who knows what will happen.

Most likely all existing entitlements will be cancelled and new entitlements issued. There is a chance that new entitlements will be linked to the value of entitlements drawn under the current scheme in order to benefit active farmers.

Business Idea · 29-07-2020 3:04pm

J.O. Farmer wrote: »

It's very much worth your while with the YFS. You need entitlements to get the young Farmers top up. Without it the value might be more limited but with the new CAP who knows what will happen.

Most likely all existing entitlements will be cancelled and new entitlements issued. There is a chance that new entitlements will be linked to the value of entitlements drawn under the current scheme in order to benefit active farmers.

Fair play thanks. They make it so complicated you'd swear they want noone to go into farming! My sums (correct me if I'm wrong) would for example be €254 + €64 + whatever disadvantaged area payment, minus €180 leasing entitlements = not much change left.

Hard Knocks · 29-07-2020 3:52pm

Business Idea wrote: »

Fair play thanks. They make it so complicated you'd swear they want noone to go into farming! My sums (correct me if I'm wrong) would for example be €254 + €64 + whatever disadvantaged area payment, minus €180 leasing entitlements = not much change left.

True, but €138/ha is allot better than some farmers are getting, with other payments afterwards

FYI
You must do a BFP application every year even if you have no entitlements
To join GLAS etc you had to have a BFP application the previous year

Best of luck

Business Idea · 29-07-2020 4:12pm

Hard Knocks wrote: »

True, but €138/ha is allot better than some farmers are getting, with other payments afterwards

FYI
You must do a BFP application every year even if you have no entitlements
To join GLAS etc you had to have a BFP application the previous year

Best of luck

Thanks, i know value of entitlements etc vary greatly, and trying to figure out how much you'd get is a bit of a 'how long is a piece of string' caper, but it'd be great if the dept some way for us to calculate what we'd get before we go head first into it

29-07-2020 5:33pm

Remember you can nominate either of the previous two years for your income assessment so if you apply in 2021 and you were under in 2019 you could nominate that year.

Business Idea · 29-07-2020 6:05pm

Roy Old Track-and-field wrote: »

Remember you can nominate either of the previous two years for your income assessment so if you apply in 2021 and you were under in 2019 you could nominate that year.

Im fairly snookered because to qualify for the YFS I need to be studying the green cert, but as I already have a higher non-agricultural qualification I won't be eligible for grants, so that's another €3000, cant afford that and it would make the YFS benefits fairly worthless

Siamsa Sessions · 29-07-2020 6:32pm

Business Idea wrote: »

Im fairly snookered because to qualify for the YFS I need to be studying the green cert, but as I already have a higher non-agricultural qualification I won't be eligible for grants, so that's another €3000, cant afford that and it would make the YFS benefits fairly worthless

You can get a tax credit of 20% of the cost of doing the green cert when you submit your tax return. Not great but every little counts.

Do you (or your parents) already have some entitlements that are being activated on the land?

If so, then you can get a top-up of 25% of the national average according to the Dept:

"The Young Farmers Scheme payment is calculated as 25% of the national average payment per hectare multiplied by your number of eligible hectares up to a maximum of 50." from https://www.gov.ie/en/service/6e97d8-young-farmers-scheme/#rates-of-payment

Business Idea · 29-07-2020 6:48pm

Siamsa Sessions wrote: »

You can get a tax credit of 20% of the cost of doing the green cert when you submit your tax return. Not great but every little counts.

Do you (or your parents) already have some entitlements that are being activated on the land?

If so, then you can get a top-up of 25% of the national average according to the Dept:

"The Young Farmers Scheme payment is calculated as 25% of the national average payment per hectare multiplied by your number of eligible hectares up to a maximum of 50." from https://www.gov.ie/en/service/6e97d8-young-farmers-scheme/#rates-of-payment

Thanks, no we have zero entitlements, land is being rented out informally

Siamsa Sessions · 29-07-2020 7:08pm

Business Idea wrote: »

Thanks, no we have zero entitlements, land is being rented out informally

Ah, OK. It's "naked land" so and outside of the National Reserve, buying or leasing entitlements are the only option.

I was in a similar position when I ended our tenant's lease in 2017. I bought entitlements in 2018 and 2019, worth approx. 200/Ha and paid 2.1 times the value in both years. It was a slight risk at the time since CAP was due to change in 2020 but thankfully we'll have our money back after this year's payment (due to slight upwards convergence). And so we'll be in "profit" with payment in 2021.

Could you lease entitlements from your tenant? He might be open to a 60/40 deal if he doesn't have any other ground on which to activate the entitlements.

Do you have any plan for what you'll do with the ground? 20-30 acres from a standing start will take a bit of work if you intend putting cattle or sheep on it.

Business Idea · 29-07-2020 7:21pm

Siamsa Sessions wrote: »

Ah, OK. It's "naked land" so and outside of the National Reserve, buying or leasing entitlements are the only option.

I was in a similar position when I ended our tenant's lease in 2017. I bought entitlements in 2018 and 2019, worth approx. 200/Ha and paid 2.1 times the value in both years. It was a slight risk at the time since CAP was due to change in 2020 but thankfully we'll have our money back after this year's payment (due to slight upwards convergence). And so we'll be in "profit" with payment in 2021.

Could you lease entitlements from your tenant? He might be open to a 60/40 deal if he doesn't have any other ground on which to activate the entitlements.

Do you have any plan for what you'll do with the ground? 20-30 acres from a standing start will take a bit of work if you intend putting cattle or sheep on it.

To be honest the tenant has plenty other land and I don't know how up to date regarding entitlements etc he is. A clean break might be best....

I'm planning on running a flock of mountain sheep, the 'good land' was ploughed and reseeded 4 years ago so is in good Nick. The hill part is ok, will need wiring fairly soon, and I'm trying to figure out my commanage rights on 300+acres of mountain. So my grand plan is sheep on the mountain between weaning and winter!

Business Idea · 30-07-2020 9:45am

And while I have ye! What's the story with entitlements on commonage?

30-07-2020 11:22am

Siamsa Sessions wrote: »

You can get a tax credit of 20% of the cost of doing the green cert when you submit your tax return. Not great but every little counts

You can’t claim anything on the first 1500 either.

J.O. Farmer · 30-07-2020 2:04pm

Business Idea wrote: »

Fair play thanks. They make it so complicated you'd swear they want noone to go into farming! My sums (correct me if I'm wrong) would for example be €254 + €64 + whatever disadvantaged area payment, minus €180 leasing entitlements = not much change left.

€138 profit on €180 investment for a 6 - 8 month investment is better than probably anything else you can do on a farm and probably most investments off farm.

Maybe time to rethink the username.

Business Idea · 30-07-2020 2:11pm

J.O. Farmer wrote: »

€138 profit on €180 investment for a 6 - 8 month investment is better than probably anything else you can do on a farm and probably most investments off farm.

Maybe time to rethink the username.

Username was for something else! So having done the research, I won't be applying for the YFS because a) €3000 to do the Green Cert, a) won't be able to apply for national Reserve. So pointless really.

So if I go for it, I'd be left with the greening and whatever disadvantaged area payment. With only 20 acres, plus probably a 10th share of 350 acres commonage, I'm having my doubts about it. Better talk to Teagasc or an agri advisor i suppose.

30-07-2020 3:34pm

Business Idea wrote: »

Username was for something else! So having done the research, I won't be applying for the YFS because a) €3000 to do the Green Cert, a) won't be able to apply for national Reserve. So pointless really.

So if I go for it, I'd be left with the greening and whatever disadvantaged area payment. With only 20 acres, plus probably a 10th share of 350 acres commonage, I'm having my doubts about it. Better talk to Teagasc or an agri advisor i suppose.

Will you be inheriting lad in future as you will likely need the green cert to avail of agri relief if you are.

Business Idea · 30-07-2020 3:40pm

Roy Old Track-and-field wrote: »

Will you be inheriting lad in future as you will likely need the green cert to avail of agri relief if you are.

No I doubt it, this will be my lot I'd say!

Donald Trump · 31-07-2020 11:01am

Roy Old Track-and-field wrote: »

Siamsa Sessions wrote: »

You can get a tax credit of 20% of the cost of doing the green cert when you submit your tax return. Not great but every little counts.

You can’t claim anything on the first 1500 either.

Can you not just have it as a "training expense"?

I thought the 20% was for full time courses that were on some approved list. If you are thinking of the online green cert, I'd have assumed it wasn't on that list as it isn't a full time course.

If you had a shop or a warehouse and sent one of the "staff" on a manual handling course, or a week-long management training course, you could write the full amount off your tax. I just assumed you could probably do the same with the Green Cert.

31-07-2020 12:14pm

Donald Trump wrote: »

Can you not just have it as a "training expense"?

I thought the 20% was for full time courses that were on some approved list. If you are thinking of the online green cert, I'd have assumed it wasn't on that list as it isn't a full time course.

If you had a shop or a warehouse and sent one of the "staff" on a manual handling course, or a week-long management training course, you could write the full amount off your tax. I just assumed you could probably do the same with the Green Cert.

A full time course has a 3k excess (for want of a better word) before you can claim tax relief and its 1500 for part time which the green cert does count.

My father paid mine as he saw it as a farm related expense and his accountant said he could claim relief on the amount above 1500 but it wasn't worth the hassle for the small bit you would get (cant remember exactly what but there was some other disadvantage to claiming it too). I'm not sure if he was able to put it against tax as a normal expense or not but I have a feeling he wasn't.

Business Idea · 31-07-2020 4:34pm

Business Idea wrote: »

And while I have ye! What's the story with entitlements on commonage?

Anybody?

J.O. Farmer · 31-07-2020 4:47pm

Business Idea wrote: »

Username was for something else! So having done the research, I won't be applying for the YFS because a) €3000 to do the Green Cert, a) won't be able to apply for national Reserve. So pointless really.

So if I go for it, I'd be left with the greening and whatever disadvantaged area payment. With only 20 acres, plus probably a 10th share of 350 acres commonage, I'm having my doubts about it. Better talk to Teagasc or an agri advisor i suppose.

So you have about 8 hectares of land without commonage so 8×€138= 1,104 for one year. If you can claim for the commonage you'd nearly break even on the green cert in year 1.

What were you hoping for, a huge profit in year 1?
Maybe talk to the teagasc advisor and look long term if you're seriously interested in farming when considering the green cert.

Young95 · 31-07-2020 4:50pm

You can’t farm without subsidies I’m afraid to say !

Business Idea · 31-07-2020 5:04pm

J.O. Farmer wrote: »

So you have about 8 hectares of land without commonage so 8×€138= 1,104 for one year. If you can claim for the commonage you'd nearly break even on the green cert in year 1.

What were you hoping for, a huge profit in year 1?
Maybe talk to the teagasc advisor and look long term if you're seriously interested in farming when considering the green cert.

Not at all, not look for a huge profit any year. I'm around sheep Farmers long enough to know that don't happen. I just don't what to dig a hole for myself.

Donald Trump · 31-07-2020 5:39pm

Young95 wrote: »

You can’t farm without subsidies I’m afraid to say !

You can if you want. It just becomes an even more expensive hobby then!

Sami23 · 04-05-2021 10:53am

Looking for advice please on Entitlements.

Basically I've leased some extra land this year for 5 years with no entitlements on it so wondering should I try to lease some ?

As I've never leased Entitlements before just wondering is there much to it and would I make much money by doing it.
Thanks

Dozer1 · 04-05-2021 11:17am

its money for jam 100% I would advise doing it.
I've only dealt with http://hmgentitlements.ie/ but there are plenty more in the journal.
Its better than any money in the bank or cattle will return for no effort.

they'll tell you how much it'll cost and how much return you are getting up front

big plus is that its all online now, years ago you needed a form signed by both parties and witnessed.

wrangler · 04-05-2021 12:57pm

Dozer1 wrote: »

its money for jam 100% I would advise doing it.
I've only dealt with http://hmgentitlements.ie/ but there are plenty more in the journal.
Its better than any money in the bank or cattle will return for no effort.

they'll tell you how much it'll cost and how much return you are getting up front

big plus is that its all online now, years ago you needed a form signed by both parties and witnessed.

My entitlements are being paid for this week and the customer will get 60% more than he paid for them, most of it in October the rest in december ....... maybe I'm being soft though.

Young95 · 04-05-2021 1:17pm

wrangler wrote: »

My entitlements are being paid for this week and the customer will get 60% more than he paid for them, most of it in October the rest in december ....... maybe I'm being soft though.

Will you consider selling them next year wrangler? Was told they’ll be a lot for sale next year ?

wrangler · 04-05-2021 1:38pm

Young95 wrote: »

Will you consider selling them next year wrangler? Was told they’ll be a lot for sale next year ?

By the time the National reserve take their 25% and then you're taxed at 35% Capital gains tax, it wasn't worth considering up to now.
There was good concessions given in the last CAP reform to transfer to the tenant, I've some leased to a tenant so he'll probably end up with them and the other guy has had them for four or five years so hopefully we try to deal.
Last Cap reform if you were even farming one hectare you were allowed keep them

Qprmeath · 19-07-2021 9:20pm

Quick question when you lease out entitlements when do you get paid for them? I thought auctioneer I used mentioned June but I’m not sure I understood him right.

wrangler · 19-07-2021 9:54pm

https://boards.ie/discussion/comment/117634550#Comment_117634550

I don't sign over my entitlements until I'm paid for them and they have to be signed over before 15th may I think....

Grueller · 19-07-2021 10:06pm

I lease them in and the auctioneer usually leaves me off until I sell cattle in late July/ early August every year and I pay him then.

Qprmeath · 20-07-2021 3:00pm

So it depends who your dealing with? No set timeframe?

Tileman · 20-07-2021 4:41pm

i use to lease entitlements and I had to pay for them in may. The auctioneer wouldn’t pay the lessor until notice went through from dept of ag that transfer was complete.

I think one year he said he wasn’t paying them until October which was when they would normally receive the bps.

wrangler · 20-07-2021 9:45pm

https://boards.ie/discussion/comment/117638257#Comment_117638257

There's no way I'd transfer until I got money,

If you transferred before payment, the lessor needn't pay if they were awkward enough

I suppose it's different if auctioneer is guaranteeing it, I got my customer 4years ago so we just transfer them our selves every year

Qprmeath · 20-07-2021 10:18pm

I do trust the fella involved but I’m fairly certain he mentioned mid June for payment. He would surely have been paid by the buyer at point of sale. Might give him a call in the next few days to clarify.