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Child Item

Accountant’s fee for CAT (Inheritance Tax) return

bbeeforsalmon

I wonder if anyone who has inherited a small business or farm can indicate what your accountant charged for completing the CAT return. I’ve just got a bill that seems to be ridiculous. In this case the inheritance was from father to son, a farm valued at one million and house at €90k. I qualified for business relief as the farm has been run as a business all along and the house was CAT free. (I did not qualify for Agri relief). There was no CAT due as expected. There had been no previous gifts or inheritances and the same accountant had been doing the farm accounts for years. I know every case is different but would like some indication of a reasonable fee.

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[Deleted User]

The account probably operated on a percentage basis. i.e. 1% is 10,900. Was their more involved than filing an IT38, which you can do yourself...

bbeeforsalmon

https://www.boards.ie/discussion/comment/120045943#Comment_120045943

Thanks. Nothing more than filling the form. It was less than €10k but I assumed it would be charged at an hourly rate.

[Deleted User]

https://www.boards.ie/discussion/2058276754/accountant-s-fee-for-cat-inheritance-tax-return

€1,200plus VAT @ 23% ?

Count Dracula

Hourly rates are charged by the hours worked. Did you not enquire about fees when signing your letter of engagement?

It never ceases to amaze me how nitty clients can get when they reflect on their fee. They haven't a breeze of the work involved and responsibility performed. It is appalling the respect that is given from clients, who are rarely happy with the outcome or the fee across the board. It is always a haggle

Easily one of the most thankless and underappreciated professions out there, after colostomy insertion which I have heard does get similar feedback.

Donald Trump

https://www.boards.ie/discussion/comment/120047963#Comment_120047963

How many hours do you think would have been worked to submit that return?

If you had an employee do the work, what would they have earned from you in that time?

[Deleted User]

https://www.boards.ie/discussion/comment/120048001#Comment_120048001

do you think the work involved was only submitting the IT38?

Count Dracula

https://www.boards.ie/discussion/comment/120048001#Comment_120048001

Depends on the return Don, you know this. To be honest I have no notion, but a full diligence would most likely have need to have been carried out. I understood that farm relief is 5%, why was the op opting for business relief at 10 % , seems odd. It is either a business or a farm or both? Bashing that one out with the op might have taken a while for starters.

But as I said, surely the fee was agreed prior to engagement?

Donald Trump

https://www.boards.ie/discussion/comment/120048016#Comment_120048016

I asked how much work would be involved in submitting it. Obviously if someone had to spend X hours finding out Y about the persons situation then that would be included if it needed to be done.

Donald Trump

https://www.boards.ie/discussion/comment/120048025#Comment_120048025

Not sure where you are getting percentages from. Farm relief and business relief both reduce the values of the eligible assets by 90% of their values. Different qualifying criteria though. Asset test can disqualify many from the former

I would have expected that it is something that should have been asked up front. But recognise that it might not have been if the person always does the work for them

Count Dracula

I always thought farm relief father to son was 5%?

I try to avoid famers in fairness, they can bury you forever. Couldn't trust them, for real.

But i hope you get my sentiment on client scrounging, I find the banter with some of these shills really painful. It is a village out there. Nothing more cringey than bartering with some greedy entrepreneur who has deemed you a pushover since the day they met you, charmless gits in general. The amount of time I spent getting some of them out of financial detriment in the crash and not so much as a thank you. Just a tutting at the bill and a look of disbelief, I have dreamt about it with a few.

Donald Trump

https://www.boards.ie/discussion/comment/120048107#Comment_120048107

If you inherit eligible agricultural assets worth 1 million, and if you qualify for Ag relief, then you are assessed as if you inherited only 100k. The reduction is the same as the business relief. (I assume that when you say the relief is 10% you are referring to what it is assessed at, rather than the reduction).

I would think that business relief is more difficult to prove because there are requirements as regards time spent working in the business. For Ag relief you only really have to satisfy the asset test and then either have sufficient educational qualifications or else lease it to someone else who does for 6 years. The relief is clawed back for either if you don't keep the assets for at least 6 years.

And I understand your point. I was only asking how much work would be involved. It was a genuine question. You could have told me 1 hour or 100 hours. I was not going to dispute it.

Count Dracula

All agreed, When I did my tax finals it was 5%, things have changed.

Would you wear a pair of green or black wellies when out for a mosey Don, just curious mind you, I doubt I will ever get the nod from any farming types, maybe a market garden in North County, if anything. How does that work anyways, as regards business or Agre relief, it there a separate valuation of the MV of the buisness, would you get any intricacies tied up in say the likes of the farm wholesaling fruit and veg every year? Surely a farmer could just say his crop was a poor yield or failed altogether, I can see them swapping crates of pears for a few pieces of livestock which thay bury up some field somewhere. The only hope the rev would have of making a score would be on industrial types you get in Kilkenny or Wexford, shipping barley up for stout and the likes, some amount of paperwork there I would imagine. Don't bother replying to any of that , but do answer the one below please?

Can the rev get access to a farms veterinary records on demand, or might they need a warrant? It should be side splitting when this 25% reduction on Livestock kicks in. 25 % of how many exactly Mr Barlemoe? No wonder the culchies are so bitter.

Donald Trump

https://www.boards.ie/discussion/comment/120048198#Comment_120048198

I'm not 100% sure of what you are asking. You would go for either the business or the agricultural relief. You wouldn't be going for both unless you were inheriting two distinct entities. Business relief is usually used as a fallback in case the beneficiary might not qualify for agricultural relief due to the asset test. Any person can inherit any land from anyone else, even a stranger, and potentially avail of agricultural relief.

Values of the assets would be lifted from the accounts. The values of the crops in the fields are neither here nor there. And there are no such things as cash sales.

If it is an inheritance from parent to child, the threshold is giving you up to about 3.35m before you are liable for CAT. In most cases, your aim would be to MAXIMIZE the value of what you are inheriting rather than minimise.

Revenue have nothing to do with veterinary or any reductions. No more than they would come in an demand to see a Health and Safety Risk Assessment document for a business you inherited. So I'm not sure what you are asking about that. But, in case you are interested, every single animal you see in a field in Ireland has it's own identifying "passport" and is required to have identifying tags corresponding to its number. Every animal has to be registered within a short time of its birth.

Count Dracula

If they see veterinary records they can technically get access to livestock sizes and ages. If they are going for the juggler they can always call the local mart, but there is no guarantees as to how or well sales are executed when you get down to it. Asking for a friend. The rev will snipe away at some of the bigger tillage farmers for sure, they will scrape any barrel they find.

All creatures great and small. They will sniff around there also, big time. Didn't they double up on a group of Surgeons who were using companies to half their liability through admin costs or something similar. The looped the hole up and nailed i think over 170 of them for 6 figures a piece? Well over 5 million anyways. They are like animals when they start sniffing around, like the CnAG snooting through a credit card bill asking what the monthly gym fees are or the 900 quid meal down in Buckleys. Civies are simply dangerous. I would love to know how much they are getting to stay away? Definitely going on I would imagine.

Donald Trump

https://www.boards.ie/discussion/comment/120048451#Comment_120048451

I still don't know what you are saying. You appear to be assuming some lacuna or loophole but I cannot tell what you are thinking exists. Can you tell me what you think is being done or why it would be done.

You cannot have an unregistered animal. If you did, for some random reason, not register an animal and then tried to hide them, well you can't do anything with that animal. If you have other animals and register any of them, you are liable for an inspection at any time where a man will come out and check that tags are present. You can't sell it because nobody would buy it. And you can't breed from it because when you register its parents (for cattle anyway). The animals identity is unique and stays with that animal. Even if an animal gets sick and dies, it has to be processed by a knackery who register it is dead/processed. So I don't know what you think is going on.

Count Dracula

That's enough for now Donald please. I have no exposure to Agri business at all, I am taking your kind words here. Very sage advice and thanks for the brief explanation. Happy New Year to you. If you know any equine vets ask them constantly for Racing tips. They are all over it.

Talk later.

[Deleted User]

The Donald does not appreciate the Revenue's insatiable appetite for raw data, which is only growing.

The poor farmers on the Cooley Peninsula, ran into trouble when their sheep had to be slaughtered for foot and mouth, and the numbers did not add up.

Donald Trump

https://www.boards.ie/discussion/comment/120049307#Comment_120049307

Well the difference is that I know what I am talking about. There is some generic comment about "access to veterinary records" without explaining what is meant by these "veterinary records". Every animal is registered and its life details are accessible from DAFM databases. So I don't know what you think these "veterinary records" are or could contain that provide anything. The only time a vet cares about the identification of an animal is when he is doing a herd test because he has to sign off that he tested every animal that is registered to you. Any other time the vet interacts with an animal, it comes out and either treats it, or gives medication and a prescription for same. But that prescription is not linked to an animal by the vet. He doesn't record the number and physical charachteristics of the animal. The farmer has to account for the usage of the medicines in his paperwork, but he does that. Not the vet.

Cattle have had to been registered for decades. Sheep did not have to be registered and tagged until relatively recently and would not have had to have been at the time of the foot and mouth. You should probably also not extrapolate a vague instance of something that happened in the border area which is not that far from bandit country and assume it is some kind of rule.

You still have to explain what you think might be going on? Where is the possible scam? Given it is a tax thread, can you give the details of the possible scam and the benefit of trying to do it? Someone is after inheriting a farm. What is the benefit to them in doing whatever you think the scam is?

bbeeforsalmon

https://www.boards.ie/discussion/comment/120048025#Comment_120048025

Agri/farm relief and business relief are exactly the same in monetary terms. A client may not qualify for Agri relief due to having too much non Agri assets but can avail of business relief provided the farm has not been leased out for the previous 2 years.

[Deleted User]

https://www.boards.ie/discussion/comment/120096777#Comment_120096777

Well, you asked for estimate of fee but haven't given any indication of you were charged way above?

bbeeforsalmon

https://www.boards.ie/discussion/comment/120047938#Comment_120047938

I didn’t say what it cost me as it might influence replies but you can multiply your suggestion by 4 and you’ll be close.

Thanks.

[Deleted User]

https://www.boards.ie/discussion/comment/120154669#Comment_120154669

No justification for that. I thought I was edging on the high side. I'd be asking for a full breakdown of hours spent etc, which you probably have.