Budget 2027: Registered Succession Farm Partnerships get a long-awaited overhaul
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Budget 2027: Registered Succession Farm Partnerships get a long-awaited overhaul
Budget 2027 brought welcome news for farm families planning the next generation. Registered Succession Farm Partnerships are being overhauled to remove the three-year waiting period between registering the partnership and transferring the agricultural assets covered by the agreement.
The income tax credit available to partners is also doubling, from €5,000 a year for five years to €10,000 a year for five years.
There may be some devil in the detail when the Finance Bill is published. But it looks like the recommendations in last year's report on Generational Renewal have been followed, and a powerful new tool to encourage the intergenerational transfer of the farm has been added to the arsenal.
What are the current conditions?
To register a Succession Farm Partnership today:
A partnership must be set up between an existing farmer and one or more young trained farmers
The existing farmer's spouse may also be a partner
All agricultural assets owned by the partners (except the farmhouse) must be used by the partnership
The young trained farmer must have at least a 20% share of the profits
The existing farmer must agree to transfer at least 80% of their farming assets (except the farmhouse) to the young trained farmer after three years, and before ten years, from setting up the partnership
The details of the proposed transfer, and the year it will take place, must be set out
A business plan for the partnership must be submitted on registration
A company cannot be a partner
How does the tax credit work?
Once these conditions are met, an income tax credit of €5,000 can be offset against the partners’ income tax liability for five years after registration.
The credit is split in line with the profit-sharing ratio
It is capped at the farm profits after capital allowances, if these are less than €5,000
It stops when the successor turns 40, if that happens before the five years are up
If the land transfer doesn’t happen, or happens in a different year from the one originally planned, the credit is clawed back
Why haven’t more farmers used them?
Since they were introduced in 2017, only around 170 Registered Succession Farm Partnerships have been registered.
The 3-year holding period and policy uncertainty
The main barrier has been the required three-year wait, combined with uncertainty about whether reliefs would be renewed or changed for the worse. With constant talk of stamp duty reliefs changing, such as the 1% rate for farmland transferred between family members, committing to a transfer three years out was a risky move. A single budget could bring major tax consequences. And if you’re happy to transfer now, why promise to do it in three years?
The 0% stamp duty age limit
Many families aim to transfer land before the successor turns 35 to avail of the 0% stamp duty rate. If the successor was already 32 or older, waiting three years meant giving up the 0% rate for the sake of the income tax credit. On less profitable farms, this often meant the family’s overall tax bill was higher with the partnership than without it.
What the changes mean
Removing the three-year holding period is very welcome. It takes away the risks and pitfalls that came with these partnerships and makes them a viable structure for intergenerational transfer. Doubling the credit to €10,000 is a nice cherry on top.
We will need to see the Finance Bill for the exact details, and we’ll update this article once it’s published.
Download our Farm Succession Guide 2026
Managing generational renewal, to guide you and your family through your succession journey.
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