Inheritence of a farm / Affordable housing offer / Which professional to use?

I applied for affordable house and might be in the process of receiving a 1 bed apartment. I meet the social requirements.

I am also in the process doing the green cert in order for tax relief on farm inhertience. The farm house will not be inherited and farm will not be sold.

I am 27 and have been advised not to take the affordable apartment as this will effect tax to be paid on inheritence?

My folks are with REPS and think they can transfer the farm into my name and they will receive a pension.

Don't know what I should do regarding this, any advice would be greatly appreciated or even what professional I should be contacting.

Re: Inheritence of a farm / Affordable housing offer

Please try to keep on topic and discuss the tax implications of affordadable housing offfer and inheritance of a farm from parents on REPS.

OT posts (and responses) have been deleted.

Bull,

Are you talking about inheritance on the death of your parents or are you talking about a gift or transferrance of the farm to you on your parents retirement?

Have you contacted the IFA? They might be able to advise on the appropriate professional. I know they bring out a yearbook with listings of all sorts of professionals.

The Irish Farmers Journal is also a very good resource.

aj

Parents are still alive so it will be gifted. I haven't contacted any agency yet as wanted to get ABM advice before taking any further action. It will probably be another 2 years before the transfer will take place as I've still to do the green cert.

"...have been advised not to take the affordable apartment as this will effect tax to be paid on inheritence?"

The apartment could affect your Capital Acquisitions Tax position, but it would be madness to turn down the apartment now on the strength of a possible tax problem down the road. If it comes to it, and there is a tax problem, you could just sell the apartment before going ahead with the land transfer.

As to the likelihood of there being a tax problem, it is impossible to give a useful opinion based on the limited facts outlined, but it is certainly possible to own an apartment and inherit a farm without suffering adverse tax consequences. Just make sure you take proper tax advice before the farm transfer goes ahead.

Re: Inheritence of a farm / Affordable housing offer

ajapale said:

Have you contacted the IFA? They might be able to advise on the appropriate professional. I know they bring out a yearbook with listings of all sorts of professionals.

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Is this some sort of sarcasm? The IFA have made an absolute mess of representing their farmer members over the years. They have so little credibility left nowadays that they have been powerless to challenge the recent over-zealous implementation of EU regulations by the Dept of Agriculture - leaving thousands of their members suffering serious financial penalties each year. In fact the IFA are probably uniquely impotent amongst the social partners in their inability to challenge the State on any major issue, and as a result we now have a proliferation of rival farming organisations, the ICSA & ICMSA being just two. The idea that the IFA should be used to source tax advice would not be shared by many people in the farming arena.

ajapale said:

The Irish Farmers Journal is also a very good resource.

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So is the Irish Independent. Would you rely on the Indo for tax advice on a complicated matter such as this? Thought not...

MOB said:

"As to the likelihood of there being a tax problem, it is impossible to give a useful opinion based on the limited facts outlined, but it is certainly possible to own an apartment and inherit a farm without suffering adverse tax consequences. Just make sure you take proper tax advice before the farm transfer goes ahead.

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The CAT agricultural relief depends (amongst other things) on the value of the assets that the person receiving the gift has after they have received the gift/inheritance. I think it would be more important to take proper tax advice before the apartment is taken (as well as taking advice before the the farm transfer occurs).

The Bull said:

..... any advice would be greatly appreciated or even what professional I should be contacting.

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Hi ubi,

Ignorance perhaps, but I wasnt being sarcastic.

The Bull asked what professional he should be contacting and I suggested that he contact the IFA ( I saw their yearbook in Easons and was impressed by the listings of agricultural service providers) and have a look at the Farmers Journal.

What professionals do you think that The Bull should contact to get advice on matters concerning "affordable housing", farm inheritance, gifting of farm property, REPS etc?

I would guess a professional accountant who specialises in agricultural matters. But there are other professionals solicitors, farm advisiors who may be of assistance.

aj

Fair enough.
I would recommend:
- An professional accountant or accredited tax consultant and perhaps a solicitor for tax issues/affordable housing query.

- An agricultural consultant or certified REPS planner for REPS-related issues.

Some agri consultants like to call themselves accountants but may not be competent to act on a complicated matter such as this.

Newby said:

The CAT agricultural relief depends (amongst other things) on the value of the assets that the person receiving the gift has after they have received the gift/inheritance. I think it would be more important to take proper tax advice before the apartment is taken (as well as taking advice before the the farm transfer occurs).

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For what its worth, I think this point is crucial.

Just to add my two cents- as both a solicitor who has dealt with farm transfers and inheritances and as someone from a farming background- my advice would be to go for a three pronged approach.

You need a professional farm tax adviser first. If you give your location, someone might have a good referral. By a farm tax advisor I mean a specialist accountant or tax consultant. This person will give you an idea of the best and most tax efficient way of dealing with both the apartment AND the farm- and whether a gift/inheritance is better. You will need to give them an idea as to the current valuation of the land/house/apartment.

Secondly you may need the advice of an agricultural consultant IF you need help in relation to REPS payments etc. One thing I would advise is to be a little careful in relation to agri consultants. There are some who, for eg, would also be auctioneers or sell pensions/investments. These therefore have a financial incentive if they sell an investment or, indeed, sell your land. So just be wary of how independant their advice is. Of course, Teagasc would be independant. And indeed, so would many others- and there's nothing to say that just because an agri consultant also does other sidelines that they wouldnt give the best advice. But its like going to a tied broker on advice on which pension to buy- be careful.

Thirdly if there is a transfer or wills to be made, then consult your solicitor in conjunction with your tax advisor.

Thanks everyone for your input. I'm located in the North Tipperary area and think the best starting point is a tax consultant familiar with agriculteral matters.