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Tax in Farming

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    #32
    Grueller
    Registered Users Posts: 5,117 ✭✭✭Grueller


    Sugarbowl wrote: »
    Without going off topic, what happens when you get the pension and still farming? Is it taxable? Does the accountant include it as wages similar to an off farm job in the books?

    You are entitled to earn €18,000 tax free as pensioner. Any thing over that is taxable regardless of where you earn it, be that pension, farm or other income.
    If you are a married couple over pension age that is €36,000 combined tax free.


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    #33
    whelan2
    Registered Users Posts: 29,153 ✭✭✭✭whelan2


    Is there an extension to the pay and file deadline this year?


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    #34
    duffysfarm
    Registered Users Posts: 846 ✭✭✭duffysfarm


    10 December
    whelan2 wrote: »
    Is there an extension to the pay and file deadline this year?


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    #35
    wrangler
    Registered Users Posts: 11,069 ✭✭✭✭wrangler


    Grueller wrote: »
    You are entitled to earn €18,000 tax free as pensioner. Any thing over that is taxable regardless of where you earn it, be that pension, farm or other income.
    If you are a married couple over pension age that is €36,000 combined tax free.

    Just realised that since all the corresondence from Inland Revenue over the last few days, Unreal concession for oldies now with that and up to €80000 tax free on leases


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    #36
    duffysfarm
    Registered Users Posts: 846 ✭✭✭duffysfarm


    sorry - when you say inland revenue do you mean HMRC or the Revenue Commissioner?
    wrangler wrote: »
    Just realised that since all the corresondence from Inland Revenue over the last few days, Unreal concession for oldies now with that and up to €80000 tax free on leases


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    #37
    893bet
    Registered Users Posts: 8,773 ✭✭✭893bet


    wrangler wrote: »
    Just realised that since all the corresondence from Inland Revenue over the last few days, Unreal concession for oldies now with that and up to €80000 tax free on leases

    Is that not the same as for anyone under 65 also? Have the same tax free allowance and can lease tax free?


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    #38
    ml100
    Registered Users Posts: 403 ✭✭ml100


    Maren Creamy Tattoo wrote: »
    Our farm basically never makes a profit everything has been pumped back into it incl the SFP for many years building sheds, buying machines, improving the yard etc. I remember when my father took over first he was getting thousands back in tax for the first few years (all tax he was paying off farm). Then his accountant said he had to stop using his off farm tax.

    I’m starting out now and want to maximise the tax savings against my off farm income but it’s a pain if I can’t keep writing off stuff against tax paid off farm as there likely won’t be enough farm income to fully use up all the tax write offs possible.

    The profit you have to make every x years is profit before capital depreciation, you may be making a profile before you write off the shed/machinery costs etc


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    #39
    Earnshaw
    Registered Users Posts: 198 ✭✭Earnshaw


    Well if profits are on the high side can't farm shed "repairs" be done as they can be written off over 1 year instead of (whatever amount of years it is) for buildings and (8years or whatever amount of years it is) for machinery?


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    #40
    Tonynewholland
    Registered Users Posts: 1,179 ✭✭✭Tonynewholland


    Earnshaw wrote: »
    Well if profits are on the high side can't farm shed "repairs" be done as they can be written off over 1 year instead of 15 for buildings and 8 years for machinery?

    I’ve never heard of 15 years


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    #41
    jaymla627
    Registered Users Posts: 6,487 ✭✭✭jaymla627


    Earnshaw wrote: »
    Well if profits are on the high side can't farm shed "repairs" be done as they can be written off over 1 year instead of (whatever amount of years it is) for buildings and (8years or whatever amount of years it is) for machinery?

    Yeah pretty above-board, but vat cant be claimed back on the cladding steel etc on "repairs"


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    #42
    [Deleted User]
    Posts: 0 ✭ [Deleted User]


    jaymla627 wrote: »
    Yeah pretty above-board, but vat cant be claimed back on the cladding steel etc on "repairs"

    Does anyone ever check this? Never mind farm "repairs " going against VAY I've even heard of lads putting in stuff they are buying for a house build etc as a farm VAT reclaim.


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    #43
    Earnshaw
    Registered Users Posts: 198 ✭✭Earnshaw


    Maren Creamy Tattoo wrote: »
    Does anyone ever check this? Never mind farm "repairs " going against VAY I've even heard of lads putting in stuff they are buying for a house build etc as a farm VAT reclaim.

    Can you both write off the "repairs" as a capital expense AND claim the VAT at a later date?


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    #44
    Pinsnbushings
    Registered Users Posts: 777 ✭✭✭Pinsnbushings


    Earnshaw wrote: »
    Can you both write off the "repairs" as a capital expense AND claim the VAT at a later date?

    No as I see it repairs are not treated as a capital excpense,
    they are a cost like meal or fert, 100 percent of the repair cost is taken off your profit in that year.. Vat can't be reclaimed.


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    #45
    Earnshaw
    Registered Users Posts: 198 ✭✭Earnshaw


    Pinsnbushings wrote: »
    No as I see it repairs are not treated as a capital excpense,
    they are a cost like meal or fert, 100 percent of the repair cost is taken off your profit in that year.. Vat can't be reclaimed.

    Farm Buildings Repairs are a capital expense.

    The question is can repairs be used as a capital expense whilst also reclaiming the VAT on them at a later point in time.


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    #46
    Dinzee Conlee
    Registered Users Posts: 2,140 ✭✭✭Dinzee Conlee


    Earnshaw wrote: »
    Farm Buildings Repairs are a capital expense.

    The question is can repairs be used as a capital expense whilst also reclaiming the VAT on them at a later point in time.

    I think the VAT form states that VAT can’t be reclaimed on repairs...

    See page 2
    https://www.revenue.ie/en/vat/documents/form-vat58.pdf


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    #47
    893bet
    Registered Users Posts: 8,773 ✭✭✭893bet


    Earnshaw wrote: »
    Farm Buildings Repairs are a capital expense.

    The question is can repairs be used as a capital expense whilst also reclaiming the VAT on them at a later point in time.

    Repairs are not a capaital expense usually. Maybe the full reroofing of a shed could be classified as a capital investment but the average repair is not as far as I have been informed by my accountant.


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    #48
    ruwithme
    Registered Users Posts: 1,183 ✭✭✭ruwithme


    I suppose accountants differ and some lads pay professional fees,and a bit of tax.


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    #49
    Pinsnbushings
    Registered Users Posts: 777 ✭✭✭Pinsnbushings


    Earnshaw wrote: »
    Farm Buildings Repairs are a capital expense.

    The question is can repairs be used as a capital expense whilst also reclaiming the VAT on them at a later point in time.

    No cant claim vat. What i meant was farm building repairs aren't treated the same as a capital expense such as a new farm building, machinery etc. in tax terms, which are written off over a number of years. The repair is written off in 1 year.


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    #50
    [Deleted User]
    Posts: 0 ✭ [Deleted User]


    Gracelynn Obnoxious Body wrote: »
    Does anyone ever check this? Never mind farm "repairs " going against VAY I've even heard of lads putting in stuff they are buying for a house build etc as a farm VAT reclaim.

    I’ve come across a fair few of your posts giving tax and accountancy advice to fellow farmers. I think the mods seriously need to add a note to your signature advising posters to ignore your advice as you generally advise tax evasion (not avoidance).

    Over the last few months you have admitted;
    - claiming back VAT back on buildings which is grand but then not telling your accountant which means you are over claiming for expenses in your tax return
    - advising people to claim all their diesel expenses from a very long commute, revenue are not stupid that will stick out like a sore thumb. Also saw you advise people to claim diesel from wife’s car which has nothing to do with farm.
    - mentioned claiming household electricity bills (fine to claim a small bit but stupid otherwise)
    - you are now talking about sneaking in a private house build into your farm expenses. I’ve seen you reference that you are building your own house!!!!!
    - in this thread you mention your farm doesn’t make a profit because “ keep writing off stuff against tax paid off farm”. Revenue are not fools they have sophisticated software that can benchmark your farms profit and expenses at expense roll up level (eg motor exps) against your peers. You give them all the information they need via the detailed form 11 tax return.

    Some day your farm may be audited by the revenue and from reading on how you run your farm you are going to be rode in back taxes and penalties (which usually equal 100% of the taxes you evaded do 2x)

    Above post seems stalkish but I keep coming across dodgy tax advice and in most cases your name is against it

    Just to clarity, pretty much all self employed people will sneak in the odd private invoice, I do too but you take the micky. Good luck to Gracelynn Obnoxious Body trying to claim vat58 / income tax deduction on their private house build :)


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    #51
    Dunedin
    Registered Users Posts: 2,231 ✭✭✭Dunedin


    Mayo_fan wrote: »
    I’ve come across a fair few of your posts giving tax and accountancy advice to fellow farmers. I think the mods seriously need to add a note to your signature advising posters to ignore your advice as you generally advise tax evasion (not avoidance).

    Over the last few months you have admitted;
    - claiming back VAT back on buildings which is grand but then not telling your accountant which means you are over claiming for expenses in your tax return
    - advising people to claim all their diesel expenses from a very long commute, revenue are not stupid that will stick out like a sore thumb. Also saw you advise people to claim diesel from wife’s car which has nothing to do with farm.
    - mentioned claiming household electricity bills (fine to claim a small bit but stupid otherwise)
    - you are now talking about sneaking in a private house build into your farm expenses. I’ve seen you reference that you are building your own house!!!!!
    - in this thread you mention your farm doesn’t make a profit because “ keep writing off stuff against tax paid off farm”. Revenue are not fools they have sophisticated software that can benchmark your farms profit against your peers. You give them all the information they need via the detailed form 11 tax return.

    Some day your farm may be audited by the revenue and from reading on how you run your farm you are going to be rode in back taxes and penalties (which usually equal 100% of the taxes you evaded do 2x)

    Above post seems stalkish but I keep seeing dodgy advice and in most cases your name is against it

    Just to clarity, pretty much all self employed people will sneak in the odd private invoice, I do too but you take the micky. Good luck trying to claim vat58 / income tax deduction on your private house build :)


    And that’s only the stuff they admitted.......


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    #52
    Earnshaw
    Registered Users Posts: 198 ✭✭Earnshaw


    Mayo_fan wrote: »
    I’ve come across a fair few of your posts giving tax and accountancy advice to fellow farmers. I think the mods seriously need to add a note to your signature advising posters to ignore your advice as you generally advise tax evasion (not avoidance).

    Yes but doesn't Revenue in a sort of a way allow for this? Like they've decided that given the incomes are so crap that this leeway sort of compensates the farmers. And it's up to individual farmers themselves in what way they want to exploit these things. Maybe Revenue do cause hardship in an audit but there'd be a lot of work in clawing back a few quid towards electricity, diesel and buildings surely.

    A bit like in the case of chicken farmers which was exposed recently... https://www.irishtimes.com/business/agribusiness-and-food/chicken-farmer-sues-revenue-over-failed-family-business-1.4260301


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    #53
    duffysfarm
    Registered Users Posts: 846 ✭✭✭duffysfarm


    no, no, no.
    Revenue can not and will not turn a blind eye to the practices of any one sector. i work as an accountant and i read that article before on irish times and i cant figure out what is going on

    Earnshaw wrote: »
    Yes but doesn't Revenue in a sort of a way allow for this? Like they've decided that given the incomes are so crap that this leeway sort of compensates the farmers. And it's up to individual farmers themselves in what way they want to exploit these things. Maybe Revenue do cause hardship in an audit but there'd be a lot of work in clawing back a few quid towards electricity, diesel and buildings surely.

    A bit like in the case of chicken farmers which was exposed recently... https://www.irishtimes.com/business/agribusiness-and-food/chicken-farmer-sues-revenue-over-failed-family-business-1.4260301


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    #54
    Earnshaw
    Registered Users Posts: 198 ✭✭Earnshaw


    duffysfarm wrote: »
    no, no, no.
    Revenue can not and will not turn a blind eye to the practices of any one sector. i work as an accountant and i read that article before on irish times and i cant figure out what is going on

    According to the whistleblower, Revenue turned a blind eye to the sector.


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