Réada Cronin (Kildare North, Sinn Fein)
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240. To ask the Minister for Finance if he will suspend the proposed agricultural relief changes pending the report of the Commission on Generational Renewal; and if he will make a statement on the matter. [44727/24]

Jack Chambers (Dublin West, Fianna Fail)
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Sections 100 and 101 of the Finance Bill 2024 (as initiated) provide for the introduction of a revised form of relief from Capital Acquisitions Tax (CAT) for gifts and inheritances of agricultural property where certain conditions are met.

I will bring an amendment at Committee stage of the Finance Bill to provide that these provisions will be subject to a commencement order. Subject to the enactment of the Bill and commencement of these provisions, the revised agricultural relief will be provided for in a new section 89A of the Capital Acquisitions Tax Consolidation Act (CATCA) 2003. It will replace the existing agricultural relief that is provided for in section 89 of the CATCA 2003.

The revised agricultural relief will differ from the existing agricultural relief in a number of respects.

A key change is the proposed introduction of two additional conditions, which relate to the ownership and use of the agricultural property prior to the date of the gift or inheritance.

The first condition is that the person from whom the beneficiary takes the gift or inheritance (the “disponer”) must have owned the agricultural property for a minimum period of 6 years prior to the date of the gift or inheritance.

The second condition is that the agricultural property must have been used for the purposes of farming by the disponer or a person to whom the property was leased in the 6 years prior to the date of the gift or inheritance.

These sections will be subject to a ministerial commencement order. This will allow time for further engagement and consultation with stakeholders, and ensure that there are no unintended consequences in relation to this measure, which is targeted at transfers of agricultural property from one generation of farmers to the next.

Niall Collins (Limerick County, Fianna Fail)
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241. To ask the Minister for Finance if he can consider issues raised in correspondence (details supplied); if he can assist this person; and if he will make a statement on the matter. [43970/24]

Jack Chambers (Dublin West, Fianna Fail)
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Sections 100 and 101 of the Finance Bill 2024 (as initiated) provide for the introduction of a revised form of relief from Capital Acquisitions Tax (CAT) for gifts and inheritances of agricultural property where certain conditions are met.

I will bring an amendment at Committee stage of the Finance Bill to provide that these provisions will be subject to a commencement order. Subject to the enactment of the Bill and commencement of these provisions, the revised agricultural relief will apply to gifts and inheritances of agricultural property taken.

The revised agricultural relief, while similar in many respects to the existing agricultural relief, differs in certain respects.

A key change is the proposed introduction of two additional qualifying conditions, which relate to the ownership and use of the agricultural property prior to the date of the gift or inheritance.

The first is that the person from whom the beneficiary takes the gift or inheritance (the “disponer”) must have owned the agricultural property for a minimum period of 6 years prior to the date of the gift or inheritance.

The second is that the agricultural property must have been actively farmed by the disponer or a person to whom the property was leased in the 6 years prior to the date of the gift or inheritance. In either case, the proposed legislation stipulates that the agricultural property must be actively farmed by an individual.

In relation to the second condition, I am advised that Revenue will accept that a lease of agricultural property may have been to another individual, a partnership or a company, as is the case under the existing agricultural relief in relation to land leased by a beneficiary. In the case of a lease to a partnership, each of the partners must have satisfied the active farmer requirements in relation to the leased land. Where the land was leased to a company, the main shareholder must have been a working director of the company and must have farmed the agricultural property on behalf of the company. Where land was leased to a company that was owned equally by an individual and his or her spouse or civil partner, at least one of them must have satisfied the working director and farming requirements to qualify for the relief. This reflects the current position in relation to land leased by a beneficiary.

Finally, I am advised that Revenue will be publishing detailed guidance on the operation of the relief.

These sections will be subject to a ministerial commencement order. This will allow time for further engagement and consultation with stakeholders, and ensure that there are no unintended consequences in relation to this measure, which is targeted at transfers of agricultural property from one generation of farmers to the next.