Forestry Taxation

SELECT Forestry Ltd is currently seeking to purchase semi-mature spruce plantations between 12 & 20 years of age. We also require wind blown sites. Independent advice should be taken by all vendors in relation to their own taxation circumstances.

Income from the ownership of woodlands managed with a view to gaining profit is exempt from Income Tax. €80,000 is the exempt amount per person per annum, assuming total income exceeds €125,000 for that person. If the woodlands are in both names each spouse can claim an €80,000annual exemption. Forest grants are not treated as income and are not affected by the tax system. Capital gains tax does not apply woodlands owned by individuals on growing timber, but the underlying land is not exempt.

Universal social charge on amount from commercial forest including forest premium is taken into account for the USC. Income from commercial forest including the forest premium is taken into account for PRSI. Stamp duty between spouses on the transfer of property is exempt. Growing timber is exempt from Stamp Duty but the underlying is not.

Capital Acquisitions tax does not apply to all gifts and inheritance between husband and wife. In the case of parent and child the rate of tax 33% and exemption rate is €225,000. These rules are complex and owners should consult their tax advisors before making large timber sales.

For further information contact myself Michael Sweeney. 087-2221661.