Dáil Éireann Debate, Thursday - 17 January 2019
61. Deputy Denis Naughten asked the Minister for Finance if the tax relief for long-term leases of farmland to landlords who provide tenants with long-term leases of accommodation will be extended; and if he will make a statement on the matter. [2070/19]
Amharc ar fhreagraI understand that the Deputy is referring to a proposed extension to the existing exemption of certain income from long-term leasing of farm land to include rent received by a lessor in respect of a residential property.
Section 664 of the Taxes Consolidation Act 1997 provides for the exemption of certain income from leasing of farm land, where the land is let under a qualifying lease, by a qualifying lessor, to a qualifying lessee.
A qualifying lease must have a minimum definite term of five years or more to qualify for the relief. Following Finance Act 2014, a qualifying lessor is exempt from income tax on progressively increasing amounts linked to lease duration as follows:
|
For leases entered into: |
Between 1 Jan 2007 and 31 Dec 2014 |
On or after 1 Jan 2015 |
|
Lease term |
€ |
€ |
|
5yrs or more (but less than 7yrs) |
12,000 |
18,000 |
|
7yrs or more (but less than 10yrs) |
15,000 |
22,500 |
|
10yrs or more (but less than 15yrs) |
20,000 |
30,000 |
|
15yrs or more |
N/A |
40,000 |
For the purposes of the relief, the definition of “farm land” includes a building “other than a building or part of a building used as a dwelling".
This relief was designed to encourage longer term leases of farm land in recognition of the advantages of long-term leasing over the short-term conacre system. The 2014 Agritaxation Review recognised the key role of long-term leases in assisting with the mobility and productive use of land, and suggested a number of enhancements to the relief which were implemented in Finance Act 2014.
As the extension proposed by the Deputy would be outside the targeted policy objective of the relief, I do not propose to make such a change to the measure at this time.
