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Tax Reliefs Eligibility

Dáil Éireann Debate, Tuesday - 22 September 2015

Tuesday, 22 September 2015

Questions (345, 372)

Seamus Kirk

Question:

345. Deputy Seamus Kirk asked the Minister for Finance the position regarding farmers who purchased milk quota during the period 1983 to 2000; if the amount of expenditure on same can be off-set against capital gains tax; and if he will make a statement on the matter. [31440/15]

View answer

Seamus Kirk

Question:

372. Deputy Seamus Kirk asked the Minister for Finance if the capital gains tax allowance on milk quota purchased between 1983 and 2000 is time limited; and if he will make a statement on the matter. [31664/15]

View answer

Written answers (Question to Finance)

I propose to take Questions Nos. 345 and 372 together.

I propose to deal with these questions together as they relate to the same issue. I am advised by the Revenue Commissioners that a claim for capital gains tax relief may arise under section 538 of the Taxes Consolidation Act 1997 in respect of losses incurred by the owners of milk quotas as a result of the abolition of those quotas earlier this year where they were purchased by the persons concerned. The allowable loss is the capital loss equivalent to the amount incurred by the person when the milk quota was acquired. However, the amount of the loss allowable is restricted to the extent that it has been covered by the amount of capital allowances or renewals allowances granted for income tax purposes. This restriction applies to quotas which were purchased on or after 1 April 2000. Claims for relief under section 538 of the Taxes Consolidation Act 1997 should be made to the tax district dealing with the tax affairs of the person concerned.

Where a claim for relief under section 538 of the Taxes Consolidation Act 1997 is allowed, the amount of the loss can be set off against chargeable gains made by a person in the year 2015 or in any subsequent year.

Assuming that the Capital Gains Tax Allowance on milk quota referred to by the Deputy relates to the loss arising as a result of the abolition of milk quotas, there is no time limit within which the loss may be carried forward and set off against chargeable gains.

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