Buying Agricultural Land In Ireland
When planning to purchase agricultural land, it is important to seek appropriate professional advice and take all related costs into account. These will include stamp duty, transaction fees and VAT. If you are borrowing to fund your purchase, only the interest on your loan is allowed as a tax deduction. Questions to discuss with your accountant include whether it is better to buy the land in your own name or to purchase it using a company structure.
buying agricultural land in ireland
Farm consolidation relief: This reduces the stamp duty to 1% (instead of the general rate of 6%) on transactions that qualify for a farm restructuring certificate and satisfy certain other conditions. This relief applies to transfers of agricultural land executed on or after 1 January 2018 and on or before 31 December 2020. Farm consolidation relief can be clawed back if the land is disposed of within 5 years of the date relief was claimed.
Agricultural land typically allows for raising livestock and growing and harvesting crops. In many cases, agricultural land allows for typical residential uses, like building a single-family home. Usually, agricultural land is relatively flexible, and most parcels of vacant, rural land fall into this category. Agricultural lands typically have a variety of properties, including:
Buying agricultural land to build a home on is different than doing so in other residential areas. You (and your real estate agent) should be familiar with farmland and things like soil makeup and water rights. Water access and rights can be a dealbreaker if you are planning on farming the land.
Agricultural zoning is intended to protect farming activities and farmland from non-farm uses, and it conserves and protects open land uses to foster growth in rural areas and prevent conflicts from urban agricultural land.
This relief is for farmers who buy and sell agricultural land in order toconsolidate their holdings and improve the viability of their farms. Itprovides for a stamp duty rate of 1% on these transactions. This relief was dueto expire on 31 December 2022. But, itwas announced in Budget 2023 that it will be extended until the end of2025.
Foreign entities buy agricultural land for a variety of reasons, such as food production, wind farming, carbon offsets, or speculative investments. In 2019, 49 percent of reported foreign-held acreage in the United States was forest land, while 25 percent was crop land, 24 percent was for pasture and other agricultural uses, and 2 percent was for non-agricultural uses (such as homesteads and roads). The USDA reports that the changes in pasture and crop land holdings since 2009 were mostly due to foreign-owned wind companies signing or terminating long-term leases.
A4: Since the 2013 purchase of Smithfield Foods, multiple bills have been proposed to provide more oversight of foreign investments in U.S. agricultural companies (including in 2017 and 2020), but until recently they each died in committee. Even if these bills had passed, they would have strengthened oversight on purchases of U.S. companies, not agricultural land specifically, leaving most land acquisitions unregulated. Furthermore, policymakers have signaled no efforts to improve state- or national-level information on foreign purchases of U.S. farmland, leaving the true picture obscured.
It is important to note that foreign entities are not the only ones aggressively buying up U.S. farmland. Many large corporations, pension funds, and wealthy individuals are investing in agricultural land in the United States and abroad. Advocacy groups like the National Family Farm Coalition argue that the larger threat to national security is corporate capture of U.S. land resources, whether those corporations are U.S.- or foreign-owned. The NYFC also points to both urban and rural development as a threat to the future of U.S. farms, since converting farmland to other uses drives up prices and makes the land unaffordable for beginning farmers. Along similar lines, climate-related efforts to increase biofuel production and expand afforestation and reforestation could reduce the amount of land available for food production in the future.
It differed from earlier legislation which initially advanced to tenants the sum necessary to purchase their holdings, repayable over a period of years on terms determined by an independent commission, while the Wyndham Act finished off absentee landlords' control over tenants and made it easier for tenants to purchase land, facilitating the transfer of about 9 million acres (36,000 km2) up to 1914. By then 75% of occupiers were buying out their landlords under the 1903 Act and the later Land Purchase (Ireland) Act (1909) of Augustine Birrell, which extended the 1903 Act by allowing for the compulsory purchase of tenanted farmland by the Land Commission, but fell far short in its financial provisions. In all, under these pre-1921 Land Acts over 316,000 tenants purchased their holdings amounting to 11.5 million acres (47,000 km2) out of a total of 20 million acres (81,000 km2) in the country.
A "ground rent" is a nominal annual rent paid where a property is held under a long lease. Legislation has reformed ground rents alongside the agricultural land laws (see above). While most tenancy reform legislation was enacted for agricultural land, urban and suburban occupiers / tenants have been allowed to "buy out" their ground rents from landlords, and so effectively can change a long lease into a freehold interest, most recently under Acts of 1978 and 2005. Notably, ground rents in Castlebar, County Mayo have been withheld following the disappearance of Lord Lucan in 1974.
Concern about Chinese purchases of U.S. agricultural land increased in late January when the China-based Fufeng Group Ltd. was prevented from building a cornmill on land close to a North Dakota Air Force base after officials called it a security risk.
Bill Gates owns almost as much U.S. agricultural land as China at 248,000 acres, according to The Land Report. Though the magazine named him the largest private farmland owner in January 2021, the Microsoft founder came under fire in early 2022 when he was briefly barred from purchasing 2,100 acres of North Dakota farmland. Conspiracy theorists suggested Gates was buying up millions of acres of U.S. farmland for nefarious reasons, according to the fact-checking service Snopes, with some claiming that Gates owned 80% of all U.S. farmland. Gates continues to deny any plot, telling Reddit users in January that he owns less than one four-thousandths of U.S. farmland and invests in farms to improve their production and create jobs.
NRIs and OCIs can sell agricultural land, plantation property, or a farmhouse only to a Resident Indian. For the lands purchased with permissions from RBI, special approvals are required to complete sale transactions.
The taxation on sale of agricultural land is different for rural and urban areas. Rural agricultural lands are not capital assets therefore no capital gains tax is applicable whereas in case of urban agricultural land capital gains tax is applicable.
Buying and selling of NRI agricultural land involves a lot of permissions and regulations that need to be taken care of. At SBNRI, we understand your struggle and offer customized solutions to your specific needs.
Members of Congress have proposed several pieces of legislation to have the federal government review or restrict purchases of U.S. agricultural land by Chinese entities, citing concerns for both national and food security. Some, ostensibly, believe that Chinese entities own substantial amounts of such U.S. land, or that the rate of increase of Chinese ownership is of particular concern.
Yet much of the analysis of Chinese ownership is not presented within the context of total foreign ownership of U.S. agricultural land, or within the context of the total amount of privately held agricultural land in the United States. This research presents a broad look at the data surrounding private ownership of U.S. agricultural land; it finds that roughly 3 percent of this land (in acres) is foreign owned, with less than 1 percent of that slice owned by Chinese nationals.
There are nearly 1.3 billion acres of privately owned agricultural land in the United States. Under the Agricultural Foreign Investment Disclosure Act, foreign investors in U.S. agricultural land must report their transactions to USDA. USDA then publishes an annual report with data from these disclosures. These annual reports provide the primary data sources for the charts and tables in this research.
Of the 1.3 billion acres of private agricultural land in the United States, foreign entities fully or partially owned roughly 40 million acres valued at $74 billion in 2021. As demonstrated in Table 1, the top 10 foreign owners of U.S. agricultural land by acres were Canada, the Netherlands, Italy, the United Kingdom, Germany, Portugal, France, Denmark, Luxembourg, and Ireland. Individuals from these countries own three-quarters of the acres owned by foreigners.
This report primarily looks at foreign ownership of U.S. agricultural land by acres, as this is a measure of the amount of land that is comparable across the country. Some also examine foreign ownership of agricultural land by the total value of the land held by foreign entities. This can lead to different results. While useful, this metric can be misleading because land values vary greatly around the country. For example, agricultural land in Iowa was valued at an average of $11,411 per acre, while in Texas agricultural land averages $4,446 per acre. Another benefit of viewing foreign ownership of agricultural land over time in terms of acres rather than land value is that it provides a measure that does not need to be adjusted for inflation.
As seen in Table 2, when sorted by total land value, the top 10 countries for foreign investors are Canada, the Netherlands, Germany, Italy, the United Kingdom, Portugal, France, Japan, Sweden, and China. While individuals from countries such as Japan, Sweden, and China own land valued at more than $2 billion, the acreage of those holdings is substantially less than that of individuals from Ireland, which is the number 10 foreign holder of agricultural land by acres in Table 1. 041b061a72