TAX

1) Pay salaries to kids/wife/parents etc is the best method as the money stays in the family.

2) Make sure you are claiming all expenses you can get away with, clothes, phones, diesel, electricity, heating, “new laptop” for the farm that a child also uses then claim a percentage of the cost.

The best way to avoid tax is spend the money but get a receipt. Building up capital allowances. As @893bet posted above. But even things like cat and dog food are tax deductible. I know a lad that had a longish drive into the farm and he tarmac'ed it. It was a justifiable expense. It has added value to his place while making travelling in and out of the farm easier.

You will never reduce tax to zero and USC will catch you on capital allowances however it's just remembering to do it right.

Wages to children have to set up right. You can no longer do it at the end of the year. But any child that works on the farm can be paid a wage. You have to set them up on revenue and pay it into there account. If you pay the by cheque they can lodge the cheque when it suits you.

You are not avoiding tax with capital allowances. Capital allowances mean you are spending the money upfront is all.

Spend 30k today and have 2k write off against tax for 15 years. You still had to spend the 30k.

That is the rock you perish on. Capital allowances are the bed rock of tax avoidance. You will never avoid tax with day to day spending.

You really only pay up front to build them up after that it's maintaining them

Y1..... 4k spend allowance 500euro

Y2.......4k spend allowance 1000euro

Y3......4k spend allowance 1500euro

Y4.......4k spend allowance 2000euro

Y5......4k spend allowance 2500euro

Y6.......4k spend allowance 3000euro

Y7.......4k spend allowance 3500euro

Y8........4k spend allowance 4000euro

Now you can make the case that by year 8 you have 32k spend but only 18 k in allowances but that gap is as big as it gets. Y16 64k spend Allowances used 50k.

When you retire just like stock allowances you can also take the remaining capital allowances as a tax free sum.

Was looking at a nice bill last year did a year end preliminary with the accountant which cost a couple of hundred but was well worth.not much use finding out 21 tax now when you can do nothing about it.

Won't be as bad this year I hope as I have done a new shed between this year and last year. I pushed as much of the expense of the shed into December as I could which turned out to be a big help.

Other things I did that helped, bought most ofthis years plastic for silage last December all the detergents,teat spray,filter socks, small bit of fertiliser, bought a meal bin, fencing posts, few general maintenance things like gate handles, egg insulators, screws, bolts etc that you always need on a farm.

Have solar panels ordered for the shed this year 100 percent write off in year 1.

Technically you are supposed to declare fertiliser as stock.

Your welcome, I haven't got them yet to be honest, hope to have them installed before Christmas anyway, paid a deposit last November believe it or not but I hadn't the shed built yet. I'm approved for a grant on them, they did the paperwork. I'm not sure if they need to be up and running, it may be possible to pay for them up front, but I suppose you'd want to trust the company.

The capital allowances are written off first year rather than over 7 years like buildings.

To the OP if it's becoming an annual issue of a large tax bill on the farming income, the possibility of a Limited company could be considered. Your off farm income is probably able to keep the house running.

Remember in a corporate entity the money is no longer yours. You pay 15%tax from now on to leave it in that entity and it has to go through the tax system before you can access it.

No but it all helps. The way you eat an elephant is one bite at a time

what is the limited for salary to a 14 ye old?

I pay my 14 year old €50 a week to be paid as a lumpsum at year's end. My accountant said that was as much as I could pay. He gave an example of a 16 year old getting €250 a week but he was working as a contractor with his father so no question of number of hours worked.

I think the 8 hours is for a 15 year old. €2500 or €3000 would be the run of it for 14 year old.

I cannot seem to get the link to Citizen Advice to paste onto here. So just Google it.

The law for 14/15 years olds is the same. 8/week, 35 during holidays and 21 days off per year. Taking the 21 days off holiday time and using Easter, Christmas, mid terms and summer holidays you are looking at 700 hours.

The minimum wage at present for an U18 years old is 7.35/hour. There is nothing to suggest that you have to pay the minimum wage. As well there is precedence to pay premium for weekend work. Even at an average 9 per hour you are still below the minimum wage. However while they are entitled to 21days off you are entitled to pay them holiday pay

700/52 is 14ish hours/week or 56 hours holiday pay. Holiday pay is more technical than that and a case for a higher number of hours is possible

That is a total of 752 hours or 6770 euro to adhere to minimum wage law.

Accountants especially smaller sole trading ones do not want to draw the revenue onto them.

Just as an aside a diary recording the nu.ber of hours per week would help in the case of any audit.

Another thing to remember is the minimum wage is increasing substantially every year so keep an eye to reference it