The renewal of consanguinity (related persons) relief and consolidation relief under the stamp duty code in the Finance Bill 2020 has been welcomed by the Irish Farmers’ Association (IFA).
Lauding the renewed reliefs, IFA Business Committee chairwoman Rose Mary McDonagh said:
“These reliefs are vital to the sustainability and viability of the agricultural sector by reducing the effective rate of stamp duty on transfers of agricultural land from 7.5% to 1% in certain circumstances.
“They are crucial for greater land mobility which encourages land transfer and succession.”
In 2019, consanguinity relief provided relief from stamp duty collectively worth €28.76 million to 1,777 successful claimants, according to the IFA.
Continuing, McDonagh said: “The relief is due to continue to operate in 2021 under the same conditions as heretofore.
“The draft Finance Bill does not propose any age limit on transferors,” she said.
However, it is important to note that the Budget 2021 Tax Expenditure Report states the case for reintroducing an age limit (formerly 67) for transferors should be examined jointly by the Department of Agriculture, Food and the Marine and the Department of Finance (with Revenue input) in 2021.
The IFA said it will be engaging with the department on this issue. However, it is likely that no change will be announced before next year’s budget, the association added.
McDonagh said: “In tandem, consolidation relief and farm restructuring relief encourage the consolidation of farm holdings to reduce farm fragmentation.
“This can be done by selling and purchasing or exchanging parcels of land to bring them closer together. This improves the operation, efficiency and viability of farms.”
Young Trained Farmer relief from stamp duty expires on December 31, 2021, and the IFA said it will be seeking to have this relief extended in Budget 2022.
The reliefs mentioned above are imperative for generational renewal which is one of the nine objectives of the Common Agricultural Policy (CAP), she concluded.