Sourcing of land for planting Valuation of Investment Properties Management of Investment Properties Sourcing of Forestry Assets
Annual Tax-Free Income
- Farm forestry will generate a tax-free income which is paid annually.
- The premium rates will depend on the Forest Type planted and the status of the applicant (Farmer/ Non-Farmer)
- This annual tax-free premium is payable for a period of 20 years for Farmers and 15 years for non-Farmers.
Generous Grants mean no capital Investment
In addition, to the annual income scheme, forestry is substantially grant aided. In most cases the planting grant covers all the establishment costs thus reducing the overall capital requirements.
Grants are payable in two instalments.
Three quarters of the grant is payable on planting and the balance is payable after four years following inspection and approval by the Forest Service
Tax Free Capital Growth
One hectare of forest will appreciate annually at an average rate of €540, tax free. By the time the forest reaches 15 to 20 years, your thinning’s will be ready for use as fencing stakes, chipboard, rustic fencing, or firewood. From year 20 onwards the thinning’s become more valuable and the uses for your timber become more variable as your trees mature. A well-managed crop of Sitka Spruce should be ready for clearfell after 30-35 years, depending on the site, and at today’s prices should yield a return of over €19,000 per ha (excluding the land).
Longer term broadleaves should yield considerably more.
Exemption from income tax, capital gains tax and stamp duty. With our current rate of taxation forestry represents a massive tax saving opportunity for farmers both full time and part time.
Income tax and Corporation tax
Profits arising to an individual or company from the occupation of forests managed on a commercial basis are exempt from tax.
Capital Gains Tax
When a forest is sold the amount received for the trees growing on the land is excluded from any chargeable gain arising.
Capital Acquisitions Tax
There is considerable scope for the tax-free transfer of forestry wealth. Woodlands are valued at only 10% of market value for capital acquisitions tax purposes when taken as a gift or inheritance.
It is not necessary for the beneficiary to be a farmer to claim this relief.
Have you considered investing in Forestry?
- Land Purchase in Ireland – Deel forestry source land suitable for afforestation throughout Ireland. This land is made available to investors to purchase, and we will then develop and manage (for 4 > years) the plantation at no additional cost to the investor by utilizing the planting grants made available through the Department of Agriculture, Fisheries and Food.
- Land prices can range from €6000 to €6,500 per acre and the lands available vary in size from 10 to 80 hectares.
- The return available on this investment is firstly represented by the tax-free forest premium available at an average rate of €863 per hectare, tax free, for the first 15 and 20 years (non-farmer and farmer) of the crops life and secondly by the inherent growth in value of the crop itself.
- Four Year Forestry Management Plan Contract