IFA Reaction To Stamp Duty Changes

IFA President Joe Healy has acknowledged the move by the Government today to remove the upper age limit for family transfers as it reduces the stamp duty liability from 6% to 1%. “This adjustment will allow more families to carry out a lifetime transfer at the rate of 1% rather than the 6% rate.”

 

Ahead of the publication of the Finance Bill tomorrow, IFA had made a detailed submission with a number of proposals based on the tax measures announced in Budget 2018.

 

Joe Healy said the increase in stamp duty is a very negative step in the context of the 2014 review of agri-taxation that represented real progress to improve land mobility, farm restructuring and the promotion of on-farm investment.

 

IFA has put forward a number of proposals:

 

  • The Finance Act must provide that land is purchased or transferred and used for farming at the 2% stamp duty rate. The qualifying criteria for this measure would be the same as Revenue currently applies for an active farmer under a number of other agri-taxation measures (Agricultural Relief, Long-term leasing).
  • To address the deterrent effect of the 6% stamp duty on family lifetime transfers, greater flexibility is required for the 1% Consanguinity Relief.  The age limit on the transferor should be removed for a one year period (i.e. for 2018), to encourage and expedite family transfers. After this period, it is proposed that an age limit of 40 would be put on the transferee, to ensure the relief incentivises timely lifetime transfers.
  • Transitional arrangements to be put in place to provide the lower rate of stamp duty (2%)  on transactions where agreement had been reached on a land transaction (transfer/purchase) before the Budget, but where the transaction had not been completed.

 

IFA is also looking for a reduced rate of stamp duty for farm consolidation and the abolition of stamp duty on long-term leases, as announced in Budget 2015, but not yet enacted.

 

The submission also identifies a number of practical measures, to ensure that participation in the Key Employee Engagement Programme (KEEP) would be available to farming enterprises.

 

Finally, there is also a detailed proposal on income averaging, whereby a farmer should be allowed to ‘step-out’ of income averaging more than once in a five-year period, where he/she is not carrying an unpaid deferred tax amount from a previous ‘step-out’.

Speak Your Mind

Tell us what you're thinking...
and oh, if you want a pic to show with your comment, go get a gravatar!