Agricultural relief is a tax relief against capital acquisition tax if you receive a gift or inheritance of agricultural property that is liable to gift or inheritance tax in Ireland.
If you qualify for agricultural relief you obtain a tax relief.
The tax relief reduces the market value of the agricultural property by 90% so that you calculate the tax due based on 10% of the market value of the agricultural property.
In other words you get 90% of the market value of the agricultural property free of Irish gift and inheritance tax.
What is Agricultural Property?
Agricultural property is: land, pasture and woodland situate in a Member State and crops, trees and underwood growing on such land.
It includes such farm buildings, farm houses and mansion houses (together with the lands occupied with such farm buildings, farm houses and mansion houses) as are of a character appropriate to the property, and farm machinery, livestock and bloodstock on such property; and a payment entitlement (within the meaning of Council Regulation (EC) No. 1782/2003 of 29 September 2003) (EU Single farm payment entitlement).
A benefit received subject to the condition that it be invested in agricultural property will be deemed to qualify as agricultural property if the investment in agricultural property is made within 2 years after the date of the benefit.
In such circumstances the time period of 6 years for the conditions to retain the agricultural relief will run from the date of investment in the agricultural property.
Please contact us if you like to discuss this matter further.