Inheriting the family farm

2021profile

Hi all,

I'd really appreciate any advice on this issue.

I'm 38 and an only child, who potentially might inherit the family farm in time to come (unless it ended up being sold off first to pay for care for elderly parents in their later years etc.).

Realistically, I don't know if I'll farm the land in the future (never say never, but not looking likely at this point in time). If I did inherit the farm, I think I would keep it and lease it out.

As I'm 38 , the clock is ticking if I am going to try and do the green cert.

In my situation, are there any benefits in doing the green cert? Would it help reduce the inheritance tax I would have to pay on the land etc.?

TIA

Siamsa Sessions

If you have the time to do it, then I’d say do it.

Lots of part-time options to do it depending on where you are in the country.

If the farm is transferred to you before you’re 40 and you’re a “trained farmer” (that is, you have the green cert), then you’ll pay a fraction of the inheritance tax. But talk to an accountant about that.

What type of farming are your parents doing? Is it possible you could farm part-time if you were ever so inclined?

2021profile

https://www.boards.ie/discussion/comment/122352202#Comment_122352202

Thank you Siamsa Sessions.

It is beef and sheep farming. Yes, there would be the option to get involved on a part-time basis in the family farm.

That's an interesting point about farm transfer before 40, I didn't know that, I'll definitely look into it.

adne

Similar question. Any benefit for a lady over 40 whose considering buying some land (won't be inheriting any) to do the green cert

Siamsa Sessions

https://www.boards.ie/discussion/comment/122352282#Comment_122352282

Kinda a different question to the OP but the green cert would give anyone a basic intro to farming in Ireland in 2024.

You could argue that it’s a narrow view of the farm enterprise options but it’s still an investment in your farming knowledge, you’ll meet other farmers, and you’ll have a certificate to show you’re serious about farming.

Hard Knocks

https://www.boards.ie/discussion/comment/122352282#Comment_122352282

I think you have to pay stamp duty once not a u40 trained Farmer

Dickie10

i transferrred in 2011,stamp duty/inheritiance tax of 10% if your not a young trained farmer ie have the green cert. if you are a young trained farmer its 1%, so a farm of 100 acres valued at 10k/acre is 1 million, 10% of that , 100,000 in tax would be due compared to 1,000 with 1% of a young trained farmer. also start getting the transfer set in motion, because you need to be plus 5 years farm transferred to avail of the Fair Deal scheme for nursing homes. it basically means the government will use your parents pension to pay for their nursing home costs. a lot can happen in 5 years so you should try to set that in motion. 400-500 an acre going for spuds and carrots in north leinster area at minute

2021profile

https://www.boards.ie/discussion/comment/122352575#Comment_122352575

Very insightful answer, thank you. Clearly, I've a lot of research to do. There are also some important conversations to be had with my parents re implications for fair deal scheme in the future etc.

roosterman71

https://www.boards.ie/discussion/comment/122352575#Comment_122352575

also start getting the transfer set in motion

How would the OP do that? They think they "might" inherit it in future? How would they bring up the conversation at home about transferring it in <2 years so the OP isn't rode by revenue?

I tried that move about 7 years ago and was told in no uncertain terms, it's the fathers till the day he dies. His accountant and solicitor both told him to transfer it as it's more tax efficient all round but no bite. It's a very hard conversation to bring up about transferring.

Donald Trump

Is the stamp duty (0%) age limit for purchasing land not 35? Consanguinity relief (1%) doesn't have an age limit I think. Regular SD is 7.5%, not 10% as mentioned above. No SD on inheritance.

You don't necessarily need to be a trained farmer to qualify for Ag Relief as you can rent it out to someone who is. You have to satisfy the asset test though which means that at the time you inherit, 80% of your total assets (which includes the new inheritance) must comprise agricultural assets. Other condition is not to sell for 7 years after.

Dickie10

id say the OP would want to be having that conversation especially about fair deal, it would be some disaster to have to sell land to pay for the nursing home costs. no harm in bringing it up. but thats easy to say for me, my father was going on about "getting it out of my name" for 10 years before we got around to it. for years afterwards he would give out if he spotted a bill like esb or eircom coming with his name on it.

SupaCat95

I hate this crap of poor planning around wills and inheritance. That thing shouldnt be decided at the last minute.

It should be decided before secondary school at the latest. With an education plan (university/trade with parttime green cert) in place and agreed with the elder farmer gently phased out and younger farmer and his family phased fully in before the younger farmer is 33 (approx). This crap of inheriting a farm when your Father AND mother die and then maybe you inherit it has to stop.

You wonder why young professional people are running off the land? Sensible inheritance and management is the answer. Sick of this crap of no wills, "be patient and your turn will come", and people hanging onto their deathbed and being cute hoors to have the last laugh.

Mature conversations need to be had where the common sense and the farms interest is not the enemy but the revenue collector is the adversary.

Dickie10

dead right just depends on each circumstance though. family farms in my area are dropping like flies most are leased out now around here to huge tillage operators or massive dairy companies and pig companies growing feed for the farms. i think land prices will cool around here anyway with derogation and SFP capped on tillage farmers , isnt there a big reduction coming? a lot of the operations that have the family farms leased around here are 150- 200k sfp. they will take some hit

Donald Trump

The "Fair Deal" aspect conversation would be a tough one. "Hey, btw, I'm probably going to be shipping you off to a home at some point but I can't do it for 5 years after you sign the place over to me so will you sign it over ASAP. Thanks."

greysides

Mod: Off topic posts moved to their own thread.

flyer_query

My input is that special farm tax relief should not be given if the receiver wont farm the land, the lease exemption should be removed from agriculture relief. If the person gifting or receiving is not a "real farmer" then treat it like a normal business transfer. Farm tax relief was introduced to help the transfer of a working farm between generations, there is a similar relief for transfer of business but that is much stricter.

This tax avoidance (not calling it evasion) with specialist reliefs only available to farmers is just driving up the cost of land as there is so little hitting the market.

Not a dig at the OP but it sickens me to see a farm pass from an active farmer to a relative (who only bothered with the farmer in the first place because they want the land) only for the relative to lease it out, that's not the spirit or purpose of the tax relief and its killing the future of farming and a barrier to entry for new farmers or those who need to expand to survive as leasing land is too risky.

J.O. Farmer

https://www.boards.ie/discussion/comment/122353108#Comment_122353108

Sure when you're at it you could maybe ask them for their thoughts on a preferred home.

Maybe you could even bring them to see a few a bit like they might have brought you to different secondary schools 🤣.

SodiumCooled

https://www.boards.ie/discussion/comment/122352202#Comment_122352202

Being over 40 doesn't matter for inheritance tax - you can still avail of agri relief regardless of age once you meet the T&Cs. Being a trained farmer under 35 allow you to avail of the stamp duty exemption. Being a trained farmer under 40 (i.e. having the green cert) also gives other benefits such as 60% TAMS grant and being able to apply to the national reserve for entitlements.