Frequently Asked Questions
1. What is meant by a “Registered Farm Partnership”?
A registered farm partnership is a partnership that is registered with the Farm Partnership Registration Office, Department of Agriculture, Food and the Marine, Agriculture House, Kildare Street, Dublin 2. The Statutory Instrument (SI) and the “Requirements for Registering of Farm Partnerships” are available on the Department of Agriculture, Food and the Marine (DAFM) website and the Teagasc website.
An information booklet “Partnerships and Farming” containing a Specimen Farm Partnership Agreement, On-farm Agreement and examples is available from Teagasc Advisory Office, Moorepark, Fermoy Co. Cork. This book also contains explanatory notes on the agreements throughout. The book itself should not be used in the formation of an agreement. A pdf document can be downloaded from http://www.teagasc.ie/collaborativearrangements/
2. Can I start a partnership during a previous tax year?
The partnership normally begins at the end of the previous tax year. For example, if your tax year ends on the 31st of December, the partnership should begin on the following 1st of January.
3. Can I exclude some land from the partnership?
All land farmed by the partners must be farmed in the partnership unless exempted by the Partnership Registration Office. For example, land under forestry, pigs, poultry, horticultural and equine enterprises can be exempted. Lands owned by the partners but not farmed by the partners can be left out of the partnership but the Partnership Registration Office must be informed of this land and a lease or rental agreement to a third party provided as evidence of not farming the land.
4. Why are State reliefs for Partnerships restricted to Registered Farm Partnerships?
Any relief measures for farm partnerships by the State can only be on the basis of a formal registration system for eligible partnerships. SI 247 of 2015 (as amended) provides for the registration of Farm Partnerships by the DAFM. For the present these provisions are the only statutory basis for defining specific farm partnerships.
5. Do I have to change or lose my herd number?
No. There is no requirement to change the herd number itself unless instructed by the DVO. It is however, necessary to change the registration on the herd number to the name of the partnership. Normally the herd number is changed into the names of the partners. For example: John, Mary and David Farmer. It is also possible to give the partnership a business name (e.g. Comeragh Farm Partnership) but this must be registered as a business name with the company registrations office (CRO).
Where two farmers are coming together with two separate herd numbers, the normal practice is to have one made dormant and transfer all the stock to the remaining herd number. The remaining herd number would be registered in the same name as the partnership.
6. Do I have limited liability?
A farm partnership has unlimited liability. For this reason a well written partnership agreement is very important. A specimen agreement is available from Teagasc at http://www.teagasc.ie/collaborativearrangements/.
7. Do I have to transfer ownership of my entitlements/quota/land to the partnership?
A farmer does not have to transfer ownership of his entitlements/quota/land to the partnership. S/he can simply licence them to the partnership and this licence can be built into the written partnership agreement.
When one herd number is used for the partnership the entitlements are transferred to that herd number. In this situation the Basic Farm Payment is applied for by the partnership and payments are made to the partnership. However, the individual partners can continue to retain separate ownership of their entitlements.
8. How long do I have to stay in a partnership?
The minimum commitment is for five years
9. Can I go into partnership with my spouse?
Yes, a spouse can register in a partnership on the Farm Partnership Register as: Category (i): if she has been farming in her own right for at least two prior to entry into partnership
Category (ii): Young trained farmer, where this applies.
Other person: Where the spouse does not qualify as either category (i) or category (ii). NOTE: in this situation, the partnership can only be formed if these are two partners who do qualify as category (i) or category (ii).
10. What educational certificate is required to qualify as a new entrant?
A FETAC Level 6 Advanced Certificate in Agriculture or equivalent is the required education standard for registering a partnership. A full list of recognised qualifications is available at http://www.teagasc.ie/collaborativearrangements/. Qualifications that are not included on the approved list must be verified by Ms Carmel Finlay of Teagasc as meeting the required equivalence of Level 6.
However, to register a partnership, a category (ii) partner must have at a minimum a “letter of expression of interest” in enrolling in an approved education course. Many of the scheme benefits will be withheld until such time as the category (ii) partner (young trained farmer) is either enrolled in or has completed the required level of agricultural education.
11. If I enter into a partnership with my son/daughter will I need to add their name to the herd number?
Yes, the herd number should be in the same name as the partnership. An ER1.1 for is required to add a name to a herd number. Advice on the addition of names to herd number should be sought from local District Veterinary Office (DVO).
12. Can I work part-time while in a partnership?
Yes, this should be agreed by the participating partners at the outset of the arrangement and written into the On-farm agreement. From a registration perspective, there is no limit on the earnings of a partner from off-farm work.
13. Is there a limit to the number of people who can be in a partnership?
The current limit on the number of people who can be in a partnership is a maximum of 10 partners.
14. If land is co-owned but one of the co-owners is not going to be in the partnership what should I do?
A person who co-owns land is eligible to be a partner only where all the persons who co-own the lands either become partners or have been exempted from this requirement by the Minister. This exemption can be applied for by filling out a RFP/COE Form which can be sourced from the Partnership Registration Office.
15. How long does it take to register the partnership?
Once all the appropriate documentation is submitted the registration of partnerships should normally be completed within three weeks. However, if documentation is missing or inadequate, this will delay the process. Pay particular attention to the DAFM check list of required documentation for registration. Ensure that all documentation is thoroughly completed.
16. Can one of the partners be paid a salary?
It is a requirement that partnership profits/loss be divided by using a profit sharing ratio. The profit sharing ratio has to be clearly stated in the written partnership agreement. However, a partnership “Salary” can also be paid to the partners to remunerate them for their work and management input.
17. How much will it cost me to register a partnership?
The DAFM do not charge for registering a partnership or maintain a partnership on the register. The costs of setting up a partnership may involve legal costs, accountancy costs and consultant costs. A “Collaborative Farming Grant” is available to successful registrations on approval to go the register. This is a 50% grant on establishment costs on a maximum cost of €5,000. Therefore the maximum grant is €2,500.
18. What specific State reliefs or incentives are in place for registered farm partnerships?
The 2012 Finance Bill included a measure whereby partners in registered farm partnership can benefit from 100% stock relief for young qualified farmers and an enhanced 50% stock relief to all other partners on income tax in respect of increases in trading stock values until 31st December 2015.
19. How many Registered Farm Partnerships are currently in existence?
There are currently around 850 RFP’s around the country. Many of these are partnerships involving a parent and son/daughter.
20. Where can I learn more?
- Teagasc website: http://www.teagasc.ie/collaborativearrangements/
- Thomas Curran, Teagasc Farm Structures Specialist.
- Tel: 025-42244, email: firstname.lastname@example.org
- Publications and information available from Teagasc including
- Partnerships and Farming (Currently being updated)
- Registered Farm Partnership Information and Application Pack
- Facilitating Farmers’ Establishment of Farm Partnerships
- Taxation and VAT Issues for Milk Production Partnerships (2 Revenue leaflets) (Currently being updated)
- Dairy Discussion Groups and Beef Technology Adoption Groups
- Your legal advisor, accountant and consultant, Teagasc advisor