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Minister Creed Announces "Succession Farm Partnership Scheme"

Tax Credits To Promote The Earlier Inter-Generational Transfer Of Family Farms

 

The Minister for Agriculture, Food and Marine, Michael Creed TD, today announced that the ‘Succession Farm Partnership Scheme’ has been approved, and administrative arrangements are being finalised for its commencement early in 2017.

 

Minister Creed said “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”.

 

The Scheme was announced in Budget 2016 but its commencement was subject to EU State Aid approval, which has now been received. The Scheme provides for a €25,000 tax credit over five years to assist with the transfers of farms within a partnership structure.

 

Minister Creed said, “I will continue to work with my colleague the Minister for Finance, who was instrumental in introducing this measure, to ensure that we build on the success of the ‘Agri-taxation Review’ and to fulfil the commitments in the ‘Programme for a Partnership Government’ to ensure strategic change in taxation system to support farm incomes and land mobility. This scheme will help to ensure that farming is strategically positioned for future sustainable growth and development.  A Working Group of officials from my Department, Revenue and Teagasc is finalising arrangements with a view to the scheme being available early in 2017.”

 

 

Note to Editors:

The examination of a measure to incentivise earlier intergenerational transfers of farms was included in the recommendations of the ‘Agri-taxation Review’. There are a number of barriers identified to increasing the number of life-time transfers of farms:

•              The requirement for two generations to derive an income stream from the farm.

•              Financial security concerns for the older generation.

•              The full transfer of the farm is sometimes considered too abrupt a change.

‘Succession Farm Partnership’ is a structure in which eligible persons enter into a partnership, and appropriate profit-sharing agreement, with the provision for the transfer of the farm to the younger farmer at the end of a specified period (not exceeding ten years). 

 

To support this transfer, a tax credit of up to a maximum of €5,000 per annum for five years, can be allocated to the partnership. The partnership model enables a gradual transfer of control and also facilitates knowledge transfer from one generation to another.

 

Food Wise 2025:  http://agriculture.gov.ie/foodwise2025/

 

View this Press Release as a PDF:  DAFMPR 168/2016 (pdf 373Kb) 

Date Released: 22 November 2016

Distribution channels: Agriculture, Farming & Forestry