Stamp Duty changes made to inter-family farmland transfers

Kevin Doyle and Margaret Donnelly

Changes have been made to planned hikes to commercial stamp duty in order to limit the number of farmers hit by the new 6pc rate.

In the Budget, it was announced that stamp duty on sales of non-residential land would rise from 2pc to 6pc.

Following a post-Budget backlash, the Cabinet has today agreed to put exemptions in place for farmers.

Under current rules ‘consanguinity relief’ is available for inter-family sales if the seller is under the age of 67. However, the Minister for Agriculture will now remove this age limit.

Farmers under the age of 35 who buy agricultural land are already exempt from the higher rate. 

This means it will be possible for all gifts and sales of farmlands to closely related family members, who do not qualify for the 100pc exemption available under the Young Trained Farmer scheme, to benefit from consanguinity relief at a stamp duty rate of 1pc.

On the recommendation of Agriculture Minister Michael Creed, it was also agreed to extend consanguinity relief for another three years and fix the stamp duty rate applying under that scheme at 1pc.

It is intended, however, that the question of an age limit will be revisited when the measure itself comes up for review towards the end of 2020.

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However, it is understood the 6pc rate of Stamp Duty on the sale of land on the open market will remain in place. Calls were made by Roscommon East Galway TD Michael Fitzmaurice to stagger the Stamp Duty rate on farmland, with 2pc being applied on land sales up to €300,000, 4pc on land sold for €300,000-500,000 and 6pc on all land sales of over €500,000.

He said that the property market for farmland had ground to a halt since the Budget as farmers were unclear as to what rate of Stamp Duty would apply on sales.

It also remains unclear when the new Stamp Duty will apply from, with farmers who bought land on Budget Day or since then unclear as to what rate of Stamp Duty they will be liable to pay.

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