604B Relief for farm restructuring

This section gives relief from capital gains tax for farm restructuring. The relief will apply to a sale, purchase or exchange of agricultural land in the period from 1 January 2013 to 31 December 2022, where Teagasc has certified that a sale and purchase or an exchange of agricultural land was made for farm restructuring purposes. The initial sale or purchase, or the exchange, must occur in the relevant period and the subsequent sale or purchase must occur within 24 months of that sale or purchase.

Full relief from capital gains tax will be given where the consideration for the purchase or the exchange of agricultural land is equal to or exceeds the consideration for the sale or the other land that is exchanged. Where the consideration for the purchase or exchange is less than the consideration for the land that is sold or the other land that is exchanged, relief will be given in the same proportion that the consideration for the land that is purchased or exchanged bears to the consideration for the land that is sold or the other land that is exchanged.

An individual who is entitled to relief under the section will be obliged to furnish certain information to the Revenue Commissioners to enable them to calculate the amount of capital gains tax that would have been payable if the relief had not applied. This information is required in order to comply with EU state aid publication requirements. Individuals who qualify for relief under the section are obliged to furnish such information at the same time as they deliver a tax return to Revenue.

A clawback of the relief is provided for where qualifying land in respect of which relief has been given is disposed of within 5 years of the date of purchase or exchange of that land. The clawback does not apply where the disposal arises under a compulsory purchase order.

Relevant Date: Finance Act 2019