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Taxes Consolidation Act, 1997 (Number 39 of 1997)

[1]>

667C Special provisions for registered farm partnerships.

(1) [8]>In this section<[8][8]>In this section and sections 667D to 667G<[8]

[9]>

common agricultural payments” means any payment arising directly to a partner under the Common Agricultural Policy of the European Union;

excluded farm asset” means farm land or livestock or machinery used for any of the following farming activities where that activity is excluded, by the terms of the partnership agreement, from the partnership:

(a)pig farming;

(b)poultry farming;

(c)mushroom farming;

(d)forestry;

(e)bloodstock farming;

(f)intensive horticultural cropping;

(g)on-farm milk processing, other than milking and storage of milk;

(h)generation of fuel or electricity;

farm asset”, other than an excluded farm asset, means—

(a)farm land,

(b)an entitlement to common agricultural payments, and

(c)livestock or machinery used for farming,

but shall not include farm land which is to be disposed of to an authority possessing compulsory purchase powers where the disposal would not be made but for the exercise of those powers, or the giving by the authority concerned of formal notice of its intention to exercise those powers;

farm land” means land which includes a building (other than a building or part of a building used as a dwelling) occupied by a partner for the purposes of farming that land;

Minister” means Minister for Agriculture, Food and the Marine;

non-active partner” means—

(a)in the case of an individual, an individual who, during the accounting period spends not more than an average of at least 10 hours per week personally engaged in the activities of the several trade, or

(b)in the case of a company, a company whose officers and employees, during the accounting period between them, spend an average of not more than 10 hours per week personally engaged in the activities of the several trade,

where the activities of the several trade are carried on on a commercial basis and in such a way that profits of the several trade could reasonably be expected to be made in that period or within a reasonable time thereafter;

partner” means a person who is a partner in a registered farm partnership;

primary participant” means the precedent partner, within the meaning of section 1007;

<[9]

qualifying farmer” has the meaning assigned to it by section 667B;

[9]>

register” means the register of farm partnerships established and maintained by the Minister under and in accordance with this section and regulations under subsection (4A);

register of succession farm partnerships” shall be construed in accordance with section 667D(1);

<[9]

[2]>

registered farm partnership” means a milk production partnership within the meaning of the European Communities (Milk Quota) Regulations 2008 (S.I. No. 227 of 2008).

<[2]

[10]>

[2]>

registered farm partnership” means—

(a) a milk production partnership within the meaning of the European Communities (Milk Quota) Regulations 2008 (S.I. No. 227 of 2008), and

(b) a farm partnership included on a register of farm partnerships established by regulations made under subsection (4A).

<[2]

<[10]

[10]>

registered farm partnership” means a farm partnership entered on the register;

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[9]>

several trade” has the meaning given to it by section 1008.

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(1A)(a)A primary participant, in relation to a farm partnership, may apply to the Minister to enter the farm partnership on the register and shall comply with all requirements relating to the application specified in regulations made under subsection (4A).

(b) In order to be entered on the register, a farm partnership shall comply with all of the following conditions:

(i)the farm partnership shall exist wholly for the purpose of carrying on the trade of farming;

(ii)the farm partnership agreement shall be in writing and shall:

(I)comply with the Partnership Act 1890;

(II)include information identifying the partners, the farm land farmed by the partnership, relating to their shares in the partnership and to the operation of the partnership;

(III) commit the partners to the agreement to a period of operation as a farm partnership of not less than 5 years,

(iii)subject to subsection (1C), the farm partnership shall have at least 2 members and not more than 10 members;

(iv)no member of the farm partnership shall be a non-active partner;

(v)of the members of the farm partnership—

(I) at least one shall be a person who has been engaged in the trade of farming on farm land owned or leased by that person, consisting of at least 3 hectares of useable farm land, for at least 2 years immediately preceding the date of formation of the partnership, and

(II) other than the person referred to in clause (I), at least one is a natural person and either satisfies the requirements of clause (I) or—

(A)has a qualification in agriculture specified in regulations made under subsection (4A) or, if not so specified a qualification determined by Teagasc - the Agriculture and Food Development Authority, to the satisfaction of the Minister, as being equivalent to a qualification so specified, and

(B)under the terms of the farm partnership, holds an entitlement to at least 20 per cent of the profits of the partnership;

(vi)other than an excluded farm asset, a partner in a farm partnership shall not have an interest in any farm asset outside of the farm partnership at any time during the period of registration of the farm partnership, and for the purposes of this section, farm land owned or leased by a partner but licensed to the farm partnership concerned shall not be treated as the partner having an interest in land outside of the farm partnership;

(vii)any payment arising to a partner in a farm partnership, from the trade of farming for the purposes of the farm partnership agreement is liable to be, and shall be paid by the partner to the farm partnership.

<[11]

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(1B)(a) The primary participant shall notify the Minister within 21 days of any change to the farm partnership or its activities and failure to do so shall result in the removal of the partnership from the register from the date of the change unless the Minister is satisfied that—

(i)the change does not affect the farm partnership’s eligibility to be entered, and remain on, the register, and

(ii)the failure was neither the result of careless nor deliberate behaviour on the part of the precedent partner and it is remedied without unreasonable delay upon the precedent partner becoming aware of the failure.

(b) (i) The primary participant shall notify the Minister, prior to a new partner joining, or an existing partner ceasing to be a partner in the farm partnership (in this paragraph referred to as an ‘alteration’), of the proposed alteration and shall request the Minister to amend the relevant entry on the register accordingly.

(ii) The Minister shall not approve a proposed alteration and amend the relevant entry on the register under subparagraph (i) unless he or she is satisfied that the farm partnership will continue to comply with the requirements of this section, and that the proposed alteration is made for bona fide commercial purposes.

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(1C) A farm partnership shall not be eligible to be entered on the register if any partner in that partnership—

(a)is a director of a company that is also a partner in that farm partnership, or

(b)has a shareholding in a company—

(i)that is also a partner in that farm partnership, or

(ii)has a shareholding in a company which directly or indirectly has a shareholding in a company which is a partner in that farm partnership.

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(1D) (a) The Minister shall only enter a farm partnership on the register where he or she is satisfied that the farm partnership has met the conditions set out in subsection (1A).

(b)Where the Minister is not satisfied that the farm partnership is continuing to meet the conditions set out in subsection (1A), then the Minister shall remove the partnership from the register with effect from the date upon which the partnership ceased to meet those conditions.

(c)A farm partnership shall stand suspended from the register where an order has been made under section 9 of the Animal Health and Welfare Act 2013, which relates to an area where any part of the farm land of the partnership is situated, but each partner in a partnership that is so suspended shall continue to be treated as a partner in a registered farm partnership for the purposes of subsection (2).

<[14]

(2) [4]>Subject to subsection (3)<[4][4]>Subject to subsection (3) and (3A),<[4] where a person is a partner in a registered farm partnership, section 666 shall apply as if in that section—

(a) in subsection (1) ‘50 per cent’ were substituted for ‘25 per cent’, and

[24]>

(b) the following was substituted for subsection (4)

‘(4) (a) A deduction shall not be allowed under this section in computing a company’s trading income for any accounting period which ends after 31 December [15]>2015<[15][21]>[15]>2018<[15]<[21][21]>2021<[21].

(b) Any deduction allowed by virtue of this section in computing the profits or gains of a trade of farming for an accounting period of a person other than a company shall not apply for any purpose of the Income Tax Acts for any year of assessment later than the year [15]>2015<[15][21]>[15]>2018<[15]<[21][21]>2021<[21].’.

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(b) the following was substituted for subsection (4)

‘(4) (a) A deduction shall not be allowed under this section in computing a company’s trading income for any accounting period which ends after 31 December 2022.

(b) Any deduction allowed by virtue of this section in computing the profits or gains of a trade of farming for an accounting period of a person other than a company shall not apply for any purpose of the Income Tax Acts for any year of assessment later than the year 2022.’,

<[24]

(3) Where a person referred to in subsection (2) is a qualifying farmer, section 667B shall apply for the purposes of this section as if in subsection (5)(a) of that section ‘50 per cent’ were substituted for ‘25 per cent’.

[5]>

(3A) (a) In this subsection—

qualifying period”, in relation to a specified person—

(i) means an accounting period in respect of which that person is entitled to a relevant deduction and each subsequent accounting period where the accounting periods in aggregate do not exceed 36 months where the specified person is a company, and

(ii) where the specified person is not a company, means a year of assessment in which that person is entitled to a relevant deduction and each of the 2 immediately succeeding [16]>years of assessment where the specified person is not a company<[16][16]>years of assessment<[16];

relevant deduction” means a deduction under section 666(1), in accordance with subsection (2)(a) of this section;

relevant tax”, in relation to a specified person—

(i) where the specified person is a company, means any corporation tax, and

(ii) where the specified person is not a company, means any income tax or universal social charge;

relief” means an amount equivalent to an amount determined by the formula—

A — B

where—

A is the amount of relevant tax that would be payable by a specified person for a year of assessment or an accounting period, as the case may be, falling within the qualifying period computed as if subsection (2) had not been enacted, and

B is the amount of relevant tax payable by the specified person for that year of assessment or accounting period, as the case may be;

specified person” means a person referred to in subsection (2), other than a person entitled to a deduction under subsection (1) of section 666 equal to 100 per cent of the excess referred to in the said subsection (1).

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(b) 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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(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.

(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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(4) This section shall not apply for any accounting period which ends before 1 January 2012 or ends after 31 December 2015.

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(4) This section shall apply in respect of any accounting period which begins on or after 1 January 2012 and ends on or before [22]>31 December [17]>2015<[17][17]>2018<[17]<[22][25]>[22]>31 December 2021<[22]<[25][25]>31 December 2022<[25].

<[6]

[3]>

(4A) (a) [18]>The Minister for Agriculture, Food and the Marine (in this subsection referred to as the “Minister”),<[18][18]>The Minister,<[18] after consultation with and with the approval of the Minister for Finance, may by regulations establish and maintain a register of farm partnerships (in this subsection referred to as the “register”) [19]>and those regulations may provide for—<[19][19]>and those regulations may make separate provision for different classes of farm partner and farm partnership and may provide for—<[19]

[20]>

(i) the form and manner of registration of a farm partnership on the register,

(ii) the conditions with which a farm partnership shall comply,

(iii) the minimum and maximum number of persons who may participate in a farm partnership,

(iv) the assignment of a unique identifier to a farm partnership included on the register,

(v) procedures for addressing non-compliance with the conditions referred to in subparagraph (ii), and

(vi) such supplemental and incidental matters as appear to the Minister to be necessary and appropriate.

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[20]>

(i) different divisions of the register relating to different classes of registered farm partnership,

(ii)the form and manner of, and information and documentation required for, an application for entry on the register,

(iii)the form and manner of registration of a farm partnership on the register,

(iv)the assignment of a unique identifier to a farm partnership entered on the register and purposes for which and conditions subject to which, it may be used,

(v)procedures where subsection (1B) or subsection (1D)(b) applies,

(vi)the agriculture qualifications required by a person for the purposes of [23]>subsection (1A)(c)<[23][23]>subsection (1A)(b)(v)(II)(A)<[23],

(vii)conditions relating to what the Minister considers to be an appropriate distance between farm land to be used by the partners in carrying on the several trade, having regard to resources and best agricultural practice, provided that no part shall be more than 75 kilometres from another part, and

(viii)such supplemental, transitional and incidental matters as appear to the Minister to be necessary and appropriate.

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(b) Every regulation made under this subsection shall be laid before Dáil Éireann as soon as may be after it is made and, if a resolution annulling the regulation is passed by Dáil Éireann within the next 21 days on which Dáil Éireann has sat after the regulation is laid before it, the regulation shall be annulled accordingly but without prejudice to the validity of anything previously done under the regulation.

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(5) This section comes into operation on such day as the Minister for Finance may appoint by order.

<[1]

[1]

[+]

Inserted by FA12 s20(d). Comes into operation on 1st day of January 2012 as per S.I. No. 455 of 2014.

[2]

[-] [+]

Substituted by FA13 s20(1)(g). Has effect from 27 March 2013.

[3]

[+]

Inserted by FA13 s20(1)(h). Has effect from 27 March 2013.

[4]

[-] [+]

Substituted by F(No.2)A13 s20(2)(a). Comes into operation on 1 January 2014.

[5]

[+]

Inserted by F(No.2)A13 s20(2)(b). Comes into operation on 1 January 2014.

[6]

[-] [+]

Substituted by F(No.2)A13 s20(2)(c). Comes into operation on 1 January 2014.

[7]

[-] [+]

Substituted by FA14 s20(e). Comes into operation on 1 January 2015.

[8]

[-] [+]

Substituted by FA15 s19(2)(e)(i)(I). Comes into operation on 1 January 2016. Note: Regulations made under section 667C(4A) and in force immediately before the commencement of subsection (2) shall continue in force as if they were regulations made under subsection (4A) amended under subsection (2) and may be amended or revoked accordingly.

[9]

[+] [+] [+]

Inserted by FA15 s19(2)(e)(i)(II). Comes into operation on 1 January 2016. Note: Regulations made under section 667C(4A) and in force immediately before the commencement of subsection (2) shall continue in force as if they were regulations made under subsection (4A) amended under subsection (2) and may be amended or revoked accordingly.

[10]

[-] [+]

Substituted by FA15 s19(2)(e)(i)(III). Comes into operation on 1 January 2016. Note: Regulations made under section 667C(4A) and in force immediately before the commencement of subsection (2) shall continue in force as if they were regulations made under subsection (4A) amended under subsection (2) and may be amended or revoked accordingly.

[11]

[+]

Inserted by FA15 s19(2)(e)(ii). Comes into operation on 1 January 2016. Note: Regulations made under section 667C(4A) and in force immediately before the commencement of subsection (2) shall continue in force as if they were regulations made under subsection (4A) amended under subsection (2) and may be amended or revoked accordingly.

[12]

[+]

Inserted by FA15 s19(2)(e)(iii). Comes into operation on 1 January 2016. Note: Regulations made under section 667C(4A) and in force immediately before the commencement of subsection (2) shall continue in force as if they were regulations made under subsection (4A) amended under subsection (2) and may be amended or revoked accordingly.

[13]

[+]

Inserted by FA15 s19(2)(e)(iv). Comes into operation on 1 January 2016. Note: Regulations made under section 667C(4A) and in force immediately before the commencement of subsection (2) shall continue in force as if they were regulations made under subsection (4A) amended under subsection (2) and may be amended or revoked accordingly.

[14]

[+]

Inserted by FA15 s19(2)(e)(v). Comes into operation on 1 January 2016. Note: Regulations made under section 667C(4A) and in force immediately before the commencement of subsection (2) shall continue in force as if they were regulations made under subsection (4A) amended under subsection (2) and may be amended or revoked accordingly.

[15]

[-] [+] [-] [+]

Substituted by FA15 s19(2)(e)(vi). Comes into operation on 1 January 2016. Note: Regulations made under section 667C(4A) and in force immediately before the commencement of subsection (2) shall continue in force as if they were regulations made under subsection (4A) amended under subsection (2) and may be amended or revoked accordingly.

[16]

[-] [+]

Substituted by FA15 s19(2)(e)(vii). Comes into operation on 1 January 2016. Note: Regulations made under section 667C(4A) and in force immediately before the commencement of subsection (2) shall continue in force as if they were regulations made under subsection (4A) amended under subsection (2) and may be amended or revoked accordingly.

[17]

[-] [+]

Substituted by FA15 s19(2)(e)(viii). Comes into operation on 1 January 2016. Note: Regulations made under section 667C(4A) and in force immediately before the commencement of subsection (2) shall continue in force as if they were regulations made under subsection (4A) amended under subsection (2) and may be amended or revoked accordingly.

[18]

[-] [+]

Substituted by FA15 s19(2)(e)(ix)(I). Note: Regulations made under section 667C(4A) and in force immediately before the commencement of subsection (2) shall continue in force as if they were regulations made under subsection (4A) amended under subsection (2) and may be amended or revoked accordingly.

[19]

[-] [+]

Substituted by FA15 s19(2)(e)(ix)(II). Note: Regulations made under section 667C(4A) and in force immediately before the commencement of subsection (2) shall continue in force as if they were regulations made under subsection (4A) amended under subsection (2) and may be amended or revoked accordingly.

[20]

[-] [+]

Substituted by FA15 s19(2)(e)(ix)(III). Note: Regulations made under section 667C(4A) and in force immediately before the commencement of subsection (2) shall continue in force as if they were regulations made under subsection (4A) amended under subsection (2) and may be amended or revoked accordingly.

[21]

[-] [+] [-] [+]

Substituted by FA18 s21(d)(i). Comes into operation on 1 January 2019.

[22]

[-] [+]

Substituted by FA18 s21(d)(ii). Comes into operation on 1 January 2019.

[23]

[-] [+]

Substituted by FA18 s21(d)(iii). Comes into operation on 1 January 2019.

[24]

[-] [+]

Substituted by FA21 s24(d)(i). Comes into operation on 1 January 2022.

[25]

[-] [+]

Substituted by FA21 s24(d)(ii). Comes into operation on 1 January 2022.