Farm transfer implications

P

polo1

Registered User
Messages
238
Can anyone tell me what the tax implications are for father transferring a farm to his son? Is there a implications here and is there anyway of avoiding it. Also do you know is it better to do it before father passes away (god forbid) or through the will process?
Any information would be great?
 
If the son passes the "farmer" test - more than 80% of his assets after the transfer are classed as agriculture assets - then the value of the property transferred is reduced by 90% for CAT purposes. The cumulative value of any gifts received from his parents since Dec 1991 is then compared to the CAT Group I threshold of around 460,000 euro and the excess, if any, is charged at 20%. Credit is given to any tax paid on prior gifts.

If the farm is transfered as a gift, then the donor ie father, may have a CGT liability. If so, this can be used to offset the CAT liability calculated
 
It is quite a detailed area. Some of the details which affect the tax situation are:


if father is in early retirement scheme;
if the land has potential development potential;
if any of the land has been leased out;
if son has substantial assets of his own;
if land value exceeds €500k;
if it is in joint names with mother;
if son has the "Green Cert" or equivalent and is under 35 (stamp duty exemption)
if father (and mother) is over 55.

Do not assume that tax advice is automatically part of the service from your solicitor. Be sure to ask.
 
MOB said:
It is quite a detailed area. Some of the details which affect the tax situation are:


if father is in early retirement scheme;
if the land has potential development potential;
if any of the land has been leased out;
if son has substantial assets of his own;
if land value exceeds €500k;
if it is in joint names with mother;
if son has the "Green Cert" or equivalent and is under 35 (stamp duty exemption)
if father (and mother) is over 55.

Do not assume that tax advice is automatically part of the service from your solicitor. Be sure to ask.
Click to expand...

MOB, thanks

The answer to the questions are as follows
THe father is not in early retirement
The land currently is in the green belt but potentially could move - its in south county dublin (approx 50 acres)
none of the land is leased out
The son is currently building a house on the land which could potentially be worth 1M+
I would imagine that the land value would be in excess of 500K considering location
Farm is in joint names with mother
The son is over 35
Both parents are in their 70's.

Can you give further information based on this.. Son does not want to approach this with father as their are two other siblings involved. Their opinion is that they thought this was sorted between father and son..
I am just concerned that their might be a huge tax bill if it is left till father / mother passes..
Thanks,
 
Its a complicated area. Why not pay for the advice?

Would you seek complicated medical advice for free on a medical forum? (hi Dr. Nick, how about that open heart stuff then?)
 
the digger said:
Its a complicated area. Why not pay for the advice?

Would you seek complicated medical advice for free on a medical forum? (hi Dr. Nick, how about that open heart stuff then?)
Click to expand...
Its not about not paying for the advise - I just wanted to get a general understanding before I went off to investigate further. Its obviously envitable that we are going to have to get advise as its not something that can be taken likely.. Sorry if my questions offended you in any way but it is a forum for sharing information after all!!
 
You must log in or register to reply here.
Back
Top