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Chapter 4
Income Tax, Corporation Tax and Capital Gains Tax
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Farm taxation
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20. Chapters 1 and 2 of Part 23 of the Principal Act are amended—
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(a) in section 657—
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(i) in subsection (1), in the definition of “an individual to whom subsection (1) applies”, by substituting the following for “but paragraphs (b) and (d) shall not apply in a case where the wife of an individual is treated for tax purposes as not living with her husband, or the civil partner of an individual is treated for tax purposes as not living with his or her civil partner;”:
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“but—
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(i) a reference to a trade in paragraphs (a) and (b) does not include a trade—
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(I) which is ancillary to the trade of farming, and
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(II) which is carried on by the individual or his or her spouse or civil partner on the farm land (within the meaning of section 664) used by the individual for the trade of farming,
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and
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(ii) paragraphs (b) and (d) shall not apply in a case where the wife of an individual is treated for tax purposes as not living with her husband, or the civil partner of an individual is treated for tax purposes as not living with his or her civil partner;”,
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(ii) in subsection (4)(b) by substituting “any of the 4” for “either of the 2”,
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(iii) by inserting the following after subsection (4):
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“(4A) Where an individual was first charged to tax in accordance with subsection (5) for the year of assessment 2014, then the individual shall be charged to tax for the year of assessment 2015 in accordance with that subsection as if a reference in that subsection to 5 years was a reference to 4 years.”,
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(iv) in subsection (5) by substituting “5 years” for “3 years” in each place,
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(v) by substituting the following for subsection (7):
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“(7) Subject to subsection (7A), where for a year of assessment an individual is by virtue of subsection (6) chargeable to income tax in respect of profits or gains from farming in accordance with subsection (5) and the individual was so chargeable for each of the 5 years of assessment immediately preceding the year of assessment, he or she may, on including a claim in that behalf with the return required under Chapter 3 of Part 41A for the year of assessment, elect to be charged to tax for that year of assessment in accordance with Chapter 3 of Part 4; but where in the case of an individual subsection (6) does not apply for any year of assessment by reason of paragraph (b)(i) of that subsection, the individual shall be deemed to be entitled to elect and to have duly elected, as respects that year of assessment, in accordance with this subsection.”,
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(vi) by inserting the following after subsection (7):
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“(7A) (a) Where as respects the year of assessment 2015 an individual duly elects or is deemed to have elected in accordance with subsection (7) that subsection shall be construed as if a reference to 5 years in that subsection was a reference to 3 years, and
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(b) where as respects the year of assessment 2016 an individual duly elects or is deemed to have elected in accordance with subsection (7) that subsection shall be construed as if a reference to 5 years in that subsection was a reference to 4 years.”,
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(vii) in subsection (8) —
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(I) by substituting the following for paragraph (b):
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“(b) there shall be made such assessment or assessments, if any, as may be necessary to secure that the amount of profits or gains from farming on which the individual who, in respect of the year of assessment 2015 duly elects or is deemed to have elected in accordance with subsection (7) is charged for each of the years of assessment 2012 and 2013, shall be not less than the amount on which the individual was charged by virtue of subsection (6) in accordance with subsection (5) for the year of assessment 2014,”,
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and
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(II) by inserting the following after paragraph (b):
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“(c) notwithstanding section 959Z, there shall be made such assessment or assessments, if any, as may be necessary to secure that the amount of profits or gains from farming on which the individual, in the case of an individual referred to in subsection (4A), is charged to tax for each of the 3 years immediately preceding the year preceding the year of assessment as respects which the individual elects or is deemed to have elected in accordance with subsection (7), shall be not less than the amount on which the individual is charged by virtue of subsection (6) in accordance with subsection (5) for the preceding year of assessment, and
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(d) in any other case, notwithstanding section 959Z, there shall be made such assessment or assessments, if any, as may be necessary to secure that the amount of profits or gains from farming on which the individual is charged to tax for each of the 4 years immediately preceding the year preceding the year of assessment as respects which the individual elects or is deemed to have elected in accordance with subsection (7), shall be not less than the amount on which the individual is charged by virtue of subsection (6) in accordance with subsection (5) for the preceding year of assessment.”,
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and
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(viii) by substituting the following for subsection (11):
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“(11) Where for any year of assessment a loss is aggregated with profits or gains in accordance with subsection (5)(b) and the amount of the loss is in excess of the profits or gains—
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(a) in the case of an individual referred to in subsection (4A), one-quarter of the amount of such excess shall be deemed for the purposes of Chapter 1 of Part 12 to be a loss sustained in the trade of farming in the final year of the 4 years, and
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(b) in any other case, one-fifth of the amount of such excess shall be deemed for the purposes of Chapter 1 of Part 12 to be a loss sustained in the trade of farming in the final year of the 5 years,
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on the average of the profits or gains of which the individual is to be charged to tax for that year of assessment, and any loss so aggregated shall not be eligible for relief under any provision of the Income Tax Acts apart from this subsection.”,
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(b) in section 664(1)(a) —
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(i) by substituting the following for the definition of “qualifying lessee”:
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“‘qualifying lessee’, in relation to a qualifying lessor or qualifying lessors, means, as the case may be—
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(i) an individual who—
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(I) is not connected with the qualifying lessor or with any of the qualifying lessors, and
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(II) uses any farm land leased from the qualifying lessor or the qualifying lessors for the purpose of a trade of farming carried on solely or in partnership,
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or
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(ii) a company which—
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(I) is not connected with the qualifying lessor or with any of the qualifying lessors,
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(II) is not controlled either directly or indirectly by any person who is connected with the qualifying lessor or with any of the qualifying lessors, and
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(III) uses any farm land leased from the qualifying lessor or the qualifying lessors for the purpose of a trade of farming carried on solely or in partnership;”,
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(ii) in the definition of “qualifying lessor” by deleting subparagraph (i),
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(iii) in subparagraph (ii)(VIII) of the definition of “the specified amount” by substituting “in the period beginning on 1 January 2007 and ending on 31 December 2014” for “on or after 1 January 2007”,
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(iv) in the definition of “the specified amount” by inserting the following after subparagraph (ii)(VIII):
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“(IX) on or after 1 January 2015—
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(A) €40,000, in a case where the qualifying lease or qualifying leases is or are for a definite term of 15 years or more,
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(B) €30,000, in a case where the qualifying lease or qualifying leases is or are for a definite term of 10 years or more, other than a case to which clause (A) applies,
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(C) €22,500, in a case where the qualifying lease or qualifying leases is or are for a definite term of 7 years or more, other than a case to which either clause (A) or clause (B) applies, and
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(D) €18,000, in any other case,”,
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and
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(v) in subparagraph (iii) of the definition of “the specified amount” by substituting “, (VIII) or (IX),” for “or (VIII),”,
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(c) in section 664(1)(b) by substituting the following for subparagraph (vi):
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“(vi) from a qualifying lease or qualifying leases made in the period beginning on 1 January 2007 and ending on 31 December 2014, and from a qualifying lease made before 1 January 2007, the specified amount shall not exceed—
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(I) €20,000, in a case where the qualifying lease or qualifying leases is or are for a definite term of 10 years or more,
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(II) €15,000, in a case where the qualifying lease or qualifying leases is or are for a definite term of 7 years or more, other than a case to which clause (I) applies, and
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(III) €12,000, in any other case;
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(vii) from a qualifying lease or qualifying leases made on or after 1 January 2015, and from a qualifying lease made at any other time, the specified amount shall not exceed—
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(I) €40,000, in a case where the qualifying lease or qualifying leases is or are for a definite term of 15 years or more,
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(II) €30,000, in a case where the qualifying lease or qualifying leases is or are for a definite term of 10 years or more, other than a case to which clause (I) applies,
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(III) €22,500, in a case where the qualifying lease or qualifying leases is or are for a definite term of 7 years or more, other than a case to which either clause (I) or clause (II) applies, and
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(IV) €18,000, in any other case.”,
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(d) in section 667B, in paragraph 2 of the Table to that section:
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(i) in subparagraph (p) by substituting “Applied Agriculture,” for “Applied Agriculture.”, and
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(ii) by inserting the following after subparagraph (p):
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“(q) Bachelor of Science (Honours) in Sustainable Agriculture.”,
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and
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(e) in section 667C(3A) by substituting the following for paragraph (b):
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“(b) Subject to paragraph (c), a specified person shall be entitled to relief in respect of relevant deductions of an amount not exceeding €7,500 in the aggregate in the qualifying period.
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(c) In the case of a qualifying period commencing on or after 1 January 2014, a specified person shall be entitled to relief in respect of relevant deductions of an amount not exceeding €15,000 in the aggregate in that qualifying period.”.
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