Give up lease to take on farm myself ?

paulmerson22

Hi all,
Im looking for some advice. I currently have 80acres rented out to a local farmer, Im getting €12,000 per annum.

I am considering taking it on myself to raise livestock, probably cattle. This would be on top of my own job, I would have quite a bit of spare time so I though it might make financial sense.

Is it worth giving up the guaranteed €12,000 income to try and take it on myself , what are the potential earnings from a farm that size ?

I would have minimal experience in farming but my family would have a farming back round so there would be a support network there.
I have mentioned taking it on myself to them and they all said id be mad to ! So Im coming on here to get other opinions on it.

Many Thanks

6480

it would take alot of money to stock it with cattle this spring and u dont know wat price cattle will be when ur ready to sell . have u slatted sheds to keep them over the winter

paulmerson22

there's no sheds at all

6480

i think u might be better keep 20 acres and see how it goes

paulmerson22

How many cattle could you keep on 20 acres ?

6480

u could keep 10 to 15 depending on size

paulmerson22

Ok, I might try that first and see how it goes.
What sort of investment would i have to make to get started ?

bbam

6480 wrote: »

i think u might be better keep 20 acres and see how it goes

That sounds like a good idea...
You will have enough land and stock to get a feel for farming, still some cash coming in for stock and other costs....
You can build it up from there if you're enjoying it or go back to full lease if it's not working out as you'd hoped..

Win-win really...

Attie

paul
Maybe a bit of reading might enlighten

http://www.farmersjournal.ie/site/farming.php?newsid=14501

Tipp Man

Is it leased or on an 11 month rent?

If its a lease then it came be hard to break (from both sides)

paulmerson22

@ Attie, thanks ill have a read

Tipp man, I would say its a gentleman's agreement and I wouldn't see any problems from the other side if I wanted to take it over

6480

have u a herd number

paulmerson22

I dont have a herd number, but my dad used to keep cattle on the land 10-15 years ago so maybe he would still have one, maybe it could be transferred to me ?

ravima

what age are you? If over 40 then you could get the rent money tax free, which is a damn sight better than farming it!

paulmerson22

Im 31 so that doesnt apply, but its interesting to note

epfff

paulmerson22 wrote: »

Hi all,
Im looking for some advice. I currently have 80acres rented out to a local farmer, Im getting €12,000 per annum.

I am considering taking it on myself to raise livestock, probably cattle. This would be on top of my own job, I would have quite a bit of spare time so I though it might make financial sense.

Is it worth giving up the guaranteed €12,000 income to try and take it on myself , what are the potential earnings from a farm that size ?

I would have minimal experience in farming but my family would have a farming back round so there would be a support network there.
I have mentioned taking it on myself to them and they all said id be mad to ! So Im coming on here to get other opinions on it.

Many

Yes you are crazzy
even if you have lots of experiance you will get eaten alive buying cattle this spring.
Taking on 20 for a start is a good runner just to get it out of system.u will need crush and pen to get/ reaccitivate herd no.
To give u a few figures for 20 acres
Year old heifers 15x850 now
All going well 15x1100 in november
Thats abt 3500 for water vet halliage time and the one that costs me is missulanious their will be lots
Remember thats all going well and your 13k is tied up on what can only be called a very volatile industry at the min

To finish if you want a hobby go for it
You wont make money and there will always be something wrong when you want to go somewhere with wife
I love it

epfff

paulmerson22 wrote: »

Hi all,
Im looking for some advice. I currently have 80acres rented out to a local farmer, Im getting €12,000 per annum.

I am considering taking it on myself to raise livestock, probably cattle. This would be on top of my own job, I would have quite a bit of spare time so I though it might make financial sense.

Is it worth giving up the guaranteed €12,000 income to try and take it on myself , what are the potential earnings from a farm that size ?

I would have minimal experience in farming but my family would have a farming back round so there would be a support network there.
I have mentioned taking it on myself to them and they all said id be mad to ! So Im coming on here to get other opinions on it.

Many

Yes you are crazzy
even if you have lots of experiance you will get eaten alive buying cattle this spring.
Taking on 20 for a start is a good runner just to get it out of system.u will need crush and pen to get/ reaccitivate herd no.
To give u a few figures for 20 acres
Year old heifers 15x850 now
All going well 15x1100 in november
Thats abt 3500 for water vet halliage time and the one that costs me is missulanious their will be lots
Remember thats all going well and your 13k is tied up on what can only be called a very volatile industry at the min

To finish if you want a hobby go for it
You wont make money and there will always be something wrong when you want to go somewhere with wife
I love it

1chippy

it could be a very expensive lesson for you but if you are really determined and willing to stick at it for years it may be a runner. its a massive change from a normal day job and theres always something to be done or a better shed you want or as i find a great place to get some peace and quiet. I know you said it would be part time., but can you accept losing weekends and evenings, restricted hols and getting time off for this that and the other.

realistically and without trying to be negative but from reading your posts i dont think you have the experience, and with all the good will and advice from other people a lot of the time you will get conflicting opinions. Farming is definately something you have to be able to do for yourself.
If you read all this and still interested, well at least your stubborn enough to farm.

Good loser

Reliable help would be of great assistance. Even if you had to pay on a daily basis - a local (older guy or neighbouring farmer) could look in if you had to be absent for maybe €5 to €10 per day.

Buy small stock, say 200 kgs and keep for two years. Outwinter on big bales.

Subdivide into 5 or 6 paddocks - reliable water in each important. A circular feeder, electric fencer and a few feed troughs.

A small tractor with bale spike and fert spreader (possibly) and a roller will do for equipment.

20 acres could handle 25 cattle on reasonable land at least - can sell some before second Winter if overstocked.

Cattle farming perhaps more a way of saving money than making it!


Could be important to be farming land in 2014. Perhaps the more the better??

Chevy RV

ravima wrote: »

what age are you? If over 40 then you could get the rent money tax free, which is a damn sight better than farming it!

Can you tell me how to get the Rent Tax Free if you are over 40. It sounds too good to be true:D


Regards,


Chevy RV

Username John

Chevy RV wrote: »

Can you tell me how to get the Rent Tax Free if you are over 40. It sounds too good to be true:D


Regards,


Chevy RV

http://www.revenue.ie/en/tax/it/leaflets/it70.html#section9

It would appear that the figures of 12k (for 5 years) and 15k (for 7 years) are across the 5 or 7 year period, and not per year?
Is that right?

kingstown

Regarding your idea of farming say 20 acres to see how you get on before you take the whole 80 acres back - sounds a good idea, I know you didn't mention it but as far as i know you cant have two herd numbers (yours for the 20 acres & the guy renting the rest of the farm) on the same land if your claiming SFP on this farm.

Farmer Pudsey

6480 wrote: »

i think u might be better keep 20 acres and see how it goes

I disagree when you are farming nowadays you want scale farming a couple cattle on 20 acres will not do this when you say you are from a farming background have you much experience. Alot will depend on your access to capital I would not do it this year the price of cattle is not in your favour at present they are overpriced. I would rent this year and wait until cattle fall back probally next spring.
This will also give you time to decide on your farming system, are you going into suckeler( if you are inexperienced I would not advise) calf to store, store to beef, weanling to forward store.
If you have capital a good shed should cost in the region of 40,000. This would if you are able to subcontract yourself and complete some of the work be six bay shed slatted with runback and crush.
There are tax advantages that will arise if you are a paye employee you can claim 66% of your car Telephone,ESB computer costs. Any losses due to startup cost investments eg shed, fencing,machinery ( not total but writedown over a no of years for most 8 years) etc will be allowable. Stock will be carried forward at vaule
You will not see the return for a number of years and will have to buy entitlements probally post 2014
You also have to take into account that you are building up capital and a buisness

Attie

kingstown wrote: »

I know you didn't mention it but as far as i know you cant have two herd numbers (yours for the 20 acres & the guy renting the rest of the farm) on the same land if your claiming SFP on this farm.

Kingstown
This should not be a problem as he would be using different land parcel numbers.

Username John

paulmerson22 wrote: »

Hi all,
Im looking for some advice. I currently have 80acres rented out to a local farmer, Im getting €12,000 per annum.

I am considering taking it on myself to raise livestock, probably cattle. This would be on top of my own job, I would have quite a bit of spare time so I though it might make financial sense.

Is it worth giving up the guaranteed €12,000 income to try and take it on myself , what are the potential earnings from a farm that size ?

I would have minimal experience in farming but my family would have a farming back round so there would be a support network there.
I have mentioned taking it on myself to them and they all said id be mad to ! So Im coming on here to get other opinions on it.

epfff wrote: »

Many

Yes you are crazzy
even if you have lots of experiance you will get eaten alive buying cattle this spring.
Taking on 20 for a start is a good runner just to get it out of system.u will need crush and pen to get/ reaccitivate herd no.
To give u a few figures for 20 acres
Year old heifers 15x850 now
All going well 15x1100 in november
Thats abt 3500 for water vet halliage time and the one that costs me is missulanious their will be lots
Remember thats all going well and your 13k is tied up on what can only be called a very volatile industry at the min

To finish if you want a hobby go for it
You wont make money and there will always be something wrong when you want to go somewhere with wife
I love it

OP - to answer your question - IMO - It wont make financial sense. If you are doing it for financial reasons - it would make more sense to try to keep it rented out, and try to get a few hours work somwehere else...

I couldnt agree more with Epfff - something will always go wrong, when you least want it to... what a life

KCTK

Username John wrote: »

http://www.revenue.ie/en/tax/it/leaflets/it70.html#section9

It would appear that the figures of 12k (for 5 years) and 15k (for 7 years) are across the 5 or 7 year period, and not per year?
Is that right?

The figures are per year, so if you lease your farm for 5 years you get the first 12k tax free per year, if leased for 7 years first 15k free per year etc. However you must be permanentally incapicated (either mentally or physically) from being able to farm to get this rent tax free and you can not lease the land to a relative.

Username John

KCTK wrote: »

The figures are per year, so if you lease your farm for 5 years you get the first 12k tax free per year, if leased for 7 years first 15k free per year etc. However you must be permanentally incapicated (either mentally or physically) from being able to farm to get this rent tax free and you can not lease the land to a relative.

Thanks KCTK - when I read it again I see it says "exemption from income tax for the first €12,000 of annual leasing income"
Not sure how I missed that first time round...

KCTK

Username John wrote: »

Thanks KCTK - when I read it again I see it says "exemption from income tax for the first €12,000 of annual leasing income"
Not sure how I missed that first time round...

Its not often we see a chance of getting something tax free so very easy to miss something with all the excitement!!!!!

Farmer Pudsey

Paul
Had you always an intrest in farming if so plan it and have a go
if you did not have an intrest in farming and are only now going to do it because of all the good vibes farming and the bandwagon it is getting forget about it

kingstown

Attie

I am not really sure about two lots of cattle on one farm and one SFM - don't understand about two parcel No's

Example
If a lad had a farm rented but for some reason wanted to keep a bit of land this year for himself say 20 acres and keep a few cattle (regardless of if thats a good idea or not) just maybe as a hobby or interest and also wanted to rent of say 60 acres to the same man who was renting all along to at least have a bit of income from the land.

Question - Could the land owner calm his SFP directly to his herd number and still have another herd renting the balance of the land?
I thought if a herd test was actioned all the cattle on the farm would have to be tested and also be under the same herd number?

mattthetrasher

any number of people can rent a farm with different herd tests different sfp entitlements my opinion on what to keep or rent is with all entrprises on such a high they can only go one way -down .take the 12k put it away and buy stock when the price is right

Attie

Kingatown
The herd test is on the herd number not the land.
SFP are on the land, all fields with entitlements have a land parcel numbers.
If i've got this right you can see the letter I recived from the department in February have removed name,address and herd number.

kingstown

Thanks Attie for taking the time to post.
I am not sure how it would work out if I decided to keep a portion of the farm myself to farm as a hobby - not sure I'd make a lot but also hope i wouldn't loose a lot either - but the main reason would be to draw down the SFP in my own name again. Mainly to safeguard the future entitlements 2014 onwards.
Thats why i thought that if i rented out the majority of the farm i couldn't have two herd numbers on the land the SFP was being claimed.
I am making a appointment with our local Dept Ag office and hopefully will be a little clearer after.

Thanks again

Attie

kingstown wrote: »

Thanks Attie for taking the time to post.
I am not sure how it would work out if I decided to keep a portion of the farm myself to farm as a hobby - not sure I'd make a lot but also hope i wouldn't loose a lot either - but the main reason would be to draw down the SFP in my own name again. Mainly to safeguard the future entitlements 2014 onwards.
Thats why i thought that if i rented out the majority of the farm i couldn't have two herd numbers on the land the SFP was being claimed.
I am making a appointment with our local Dept Ag office and hopefully will be a little clearer after.

Thanks again

Kingstown
You are welcome
Also see if ye can fiend name of local adviser he might also be of help.
Teagasc may help.
Shall PM you.