From yesterday, 1st January, 2015, the rules relating to agricultural relief have altered. Essentially, Revenue require real farming to be part of the process, if a beneficiary wants to avail of the relief.
Up to the end of 2014, in order to be classed as a “farmer”, the only test you had to pass, was a mathematical one, i.e. greater than 80% of all your assets, including the value of the gift/inheritance, needed to be agricultural if you were to be a farmer for CAT purposes. It mattered not that you never had been even on a farm or that you couldn’t tell a heifer from a horse. It allowed for post death planning, where a beneficiary’s non-agricultural assets were transferred to ensure they passed the 80% rule.
Since 1st January, 2015, the beneficiary will need to satisfy one of the following :-
- Be a trained farmer and actively farm the land ;
- Be an active farmer, spending at least 50% of your working time in farming activities;
- Lease the agricultural property for at least 6 years to a person who satisfies either of the above criteria.
It is vital to examine all criteria for agricultural relief before embarking on a farm transfer.
– Holland Condon Solicitors Kilkenny