Creed launches €25,000 Family Farm Partnership tax credit
The Minister for Agriculture, Michael Creed has launched a €25,000 Family Farm Partnership tax credit today.
Minister Creed announced that the ‘Succession Farm Partnership Scheme’ has been approved, and administrative arrangements are being finalised for its commencement early in 2017.
“This Scheme will promote the earlier inter-generational transfer of family farms, in line with Programme for Government commitments and the Food Wise strategy.
“It will encourage and support important conversations within farm families about succession planning,” he said.
Speaking at last night’s Carrigaline Macra na Feirme conference titled Irish Agriculture – At a crossroads, the Minister announced that he will be launching the succession measure today, November 22.
The Minister said the measure, which required EU clearance, will encourage farmers to sign over land to the next generation.
“One of the challenges identified in that context in the agri-taxation review was how to smooth the transition where a farmer would be obliged to deliver a reasonable standard of living and income for two families,” he said.
The Family Farm Partnership measure will involve a €25,000 tax credit over a five-year period, he said, with an aim of encouraging farmers to sign over land to the next generation.
Further details of the scheme are expected to be made available later today, but it is understood that the structure will allow two people, for example family members, to enter into a partnership with an appropriate profit-sharing agreement.
This agreement makes the provision for the transfer of the farm to the young farmer at the end of a specified period, not exceeding ten years.
Under the scheme, 80% of the farm must be transferred to the young person by the end of the 10 year period, while the Department had previously confirmed the the ‘favorite niece or nephew’ are included under this measure.
Introducing the tax credit in 2015, the Minister for Finance Michael Noon said it will increase the certainty about the timing of the transfer of a family farm to the next generation of farmers and will greatly assist with long-term planning and farm productivity.
The measure is expected to cost the state €10m per annum.