Tax windfall for pre-2000 quota buyers
Published 30/09/2015 | 02:30
Farmers that bought milk quota prior to 2000 or Single Farm Payments between 2005-2103 are in line for a tax relief windfall.
Farm lobbyists succeeded in convincing the Revenue Commissioners that the cessation of both milk quota and the Single Farm Payment systems reduced the value of investments by farmers in either quota or entitlements to negligible values.
As a result, the amounts spent by farmers on purchasing quota prior to 2000 or Single Farm Payments can now be used as a tax write-off against future capital gains windfalls.
The decision followed a similar course of action taken by the UK authorities, according to IFAC's Declan McEvoy.
The ICMSA said that it was important for all farmers to ensure they maximised the range of tax reliefs available to them.
Milk quota purchased after 2000 was allowable against income tax, so it has already been written off in the opinion of the Revenue.
The news is particularly timely for Glanbia shareholders that have benefitted from share spin-outs over the last number of months.
Glanbia spun-out 10 million Plc shares to its 15,600 members in August. The value to shareholders was estimated at €174m, based on a Glanbia share price of €17.35 at the time.