Finance bill changes 'devastating for young farmers'
Changes published in the Finance Bill are set to spell 'very bad news for farmers', according to Declan McEvoy Head of Tax at accountancy firm Ifac.
He said the Bill, as currently drafted, contains provisions that would be devastating for young farmers if not addressed before the bill becomes law.
The Finance Bill introduced a cumulative €70,000 lifetime cap on the benefit any one farmer can receive under three farming related tax reliefs (the young trained farmer stamp duty relief, stock relief for young trained farmers and succession farm partnerships).
Minister Donohoe said he is aware of the concerns raised by the farming bodies over the issue. However, he said the origin of the €70,000 cap lies in EU law.
He said EU regulations introduced in 2014 provide for state aid rules concerning start-up aid for young farmers and the development of farms.
McEvoy said this intervention is very significant and significantly complicates the tax landscape for young farmers. Specifically, it means Young Farmer stamp duty relief is now being treated as start-up aid, and so the tax relief being made available to young farmers is significantly less than in previous years.
Young Farmers seeking to buy land off a relative after 2020 or any non-relative from 1 January 2019 will now not be able to avail of tax relief for those transactions under the scheme.
Most young farmers will have used up their full €70,000 relief allocation by 1 January 2019 as anyone submitting a tax return from that date must, for the first time, consider the amount of duty they have claimed since 1 July 2014 (and the total amount should not exceed €70,000).