Land transfer

obi604

https://www.boards.ie/discussion/comment/121455495#Comment_121455495

Don’t get the 600k bit.

Donald Trump

https://www.boards.ie/discussion/comment/121455523#Comment_121455523

Simple maths.

If you have 1m, spend 600k on (say) land, then you have 400k non-ag assets left.

Suddenly you inherit 1m ag assets. You now have 1.6m ag assets and 400k non-ag.

Asset test passed

obi604

https://www.boards.ie/discussion/comment/121455533#Comment_121455533

But is this applicable to the 1M and 4M example you gave.

Sheep breeder

Best advice go and talk to a solicitor, who will point you in the right direction and the best money you will spend.

Donald Trump

https://www.boards.ie/discussion/comment/121455596#Comment_121455596

I don't know what you are asking me. It's maths. The asset test is one of the conditions for Agricultural relief - Ag Relief means Revenue will treat your inheritance as if it was 10% of the real figure if you satisfy all the conditions.

If you have 1m of non-ag assets today and you inherit 4m of ag assets tomorrow, then your total assets tomorrow will be 5m and 80% of those will be ag assets and you will pass the asset test.

If you have 1m of non-ag assets today and you inherit 3.9m of ag assets tomorrow, then your total assets tomorrow will be 4.9m and 79.59% of those will be ag assets and you will not pass the asset test.

kollegeknight

https://www.boards.ie/discussion/2058325650/land-transfer

Hi Op,

if I were you, I would talk to Aisling Meehan from Newmarket on Fergus in east Clare. Afaik, she does online meetings if it’s too far for you.

She is an accountant and solicitor, writes for Farmers journal.

Not cheap for consultancy but genuinely the best person I spoke to and worth every penny.

i ended up using her as solicitor as my mother and I would have had the same solicitor prior.

Mooooo

OP, talk to an ag accountant and solicitors, ideally get quotes from all esp the solicitors for any work to be done. Your father's ones might do

They would have done this all before. There are prob local accoubtsnts out there but FDC and IFAC would be practices active in most areas if you want more well known

obi604

Thanks for all the comments and help.

Really high level without even mentioning words such as consanguinity relief, stamp duty, agricultural reliefs, CAT, CGT etc etc

Lets say I have assets of 400k and the farm and machinery etc are worth 400k. I could potentially have a big tax bill to pay.  Something like 80k or so, but not entirely sure.

Like a lot of Irish families, we don't like talking about money and more so talking about land and land ownership.

We rarely talk about it openly but I need to talk to my mother and father (my father more so) and say look if we sit on our hands now and do nothing, I could essentially get hit with a tax bill of 80,000 euro.

My father did this exercise 50 years ago when there was very little red tape and now does not understand this or will just ignore it.

I just need to try and tell him I could get lumped with a big tax bill here, does the 80k sound about right based on above? At least if I have a figure for him, he will understand the seriousness of this and if he hears 80k it will resonate with him

ABitofsense

https://www.boards.ie/discussion/comment/121456517#Comment_121456517

I have this process done in the last couple of years. You need to speak to a GOOD solicitor who know their stuff and an Agri Accountant. There is loads of way to reduce the tax bill for you and any impact to your father too. Every farm situation is different. I only ended up paying 1% tax.

SodiumCooled

https://www.boards.ie/discussion/comment/121455269#Comment_121455269

Money in your account counts, money in a joint account counts at 50%, money in your wife’s sole accounts don’t count.

in other words all savings etc should be moved to an account with only your wife’s name. I know of someone who had to put their house into their wife’s name only to meet the criteria and doing this availed of the relief without issue.

As mentioned big advantage doing it now is avoiding the fair deal scheme and also if you are interested in farming it’s good to be getting more involved and getting to grip with the finances.

You should consider doing the green cert it makes getting the 90% cat reduction much easier.

arrowman

As already mentioned - get talking early to your accountant and your solicitor and set out what you are planning. Get an assessment done on the total costs of the transfer including fees and any potential taxes so that you don't get any shocks after the event.

It usually makes sense to get a transfer done as a gift if taxes can be managed.

Also have a look at the Teagasc website for their Succession & Inheritance information - https://www.teagasc.ie/rural-economy/farm-management/succession--inheritance/

A useful 3-page summary here - https://www.teagasc.ie/publications/2022/transferring-the-family-farm---what-do-i-need-to-know.php

and a webinar outlining the taxes here (this is from 2020 but still fairly relevant) -

https://www.youtube.com/live/JkDg8qETkEw?si=_iTRILFIJfJTfmrs&t=2526

leex

If you incurred debt for a transfer, what is the most tax efficient way of handling this?