I am advised by Revenue that there is no income tax exemption relating to the sale of horses. Rather, where an individual’s ownership and racing of racehorses is considered a “hobby” or a “recreational activity”, it will fall outside the scope of income tax. Where, however, the ownership and racing of racehorses forms part of a trade carried on by a person, the proceeds from the sale of a horse is not outside the scope of income tax and must be taken into account in computing income from the trade which is chargeable to income tax. Whether an individual’s activities in relation to a racehorse constitute a trade or a hobby depends on the particular facts of the case.
As the Deputy is referring to a particular case, it is recommended that the relevant taxpayer seeks further guidance from Revenue on the applicable tax treatment by providing the full facts of the case and submitting a query through the Revenue Technical Service. Guidance on submitting a query is available on the Revenue website at:
https://www.revenue.ie/en/tax-professionals/tdm/income-tax-capital-gains-tax-corporation-tax/part-37/37-00-00a.pdf .