Retirement Relief Capital Gains Tax

[johnkellyof]

Hello my father was a retired farmer who died last September.
He and my mam co-owned 32 acres of land and had it rented out on short term let and when he died my mam inherited it all. They have owned this land since before 1970.
My mother is now thinking of selling this land. Question is does she qualify for retirement relief or exemption from Capital Gains Tax when she sells? Also if not then how is CGT calculated?
thanks in advance

 

[Joe_90]

In order to qualify for retirement relief there are a number of criteria:
1. The individual has to be 55 years of age.
2. The individual has to be disposing of qualifying assets.

Qualifying assets are assets that have been owned and used for the purposes of a trade for 10 years.

Land which has been let can qualify as qualifying assets of it had been used for the purposes of a trade for the 10 years prior to being let and the letting started 25 years prior to the sale.

In the case of a surviving spouse they will take on the trade period from their deceased spouse.

So in your case your mother has an asset which she acquired in two stages. 1/2 in the 1970s and half on the death of your father. So one 1/2 has a base cost of say IR£250 per acre x 6 and the other 1/2 say €10,000.

Of your father was a farmer prior to letting the land then it all should qualify for Retirement Relief. You should consider consulting and an accountant as there are very generous relief for farmland and potentially a lot of tax free income for you if she gave you the farmland rather than selling it.

 

[johnkellyof]

In order to qualify for retirement relief there are a number of criteria:
1. The individual has to be 55 years of age.
2. The individual has to be disposing of qualifying assets.

Qualifying assets are assets that have been owned and used for the purposes of a trade for 10 years.

Land which has been let can qualify as qualifying assets of it had been used for the purposes of a trade for the 10 years prior to being let and the letting started 25 years prior to the sale.

In the case of a surviving spouse they will take on the trade period from their deceased spouse.

So in your case your mother has an asset which she acquired in two stages. 1/2 in the 1970s and half on the death of your father. So one 1/2 has a base cost of say IR£250 per acre x 6 and the other 1/2 say €10,000.

Of your father was a farmer prior to letting the land then it all should qualify for Retirement Relief. You should consider consulting and an accountant as there are very generous relief for farmland and potentially a lot of tax free income for you if she gave you the farmland rather than selling it.

Thanks Joe thats very helpfull