Agricultural Relief

Can Agricultural Relief be withdrawn or clawed back?

Agricultural Relief can be withdrawn or clawed back in the following circumstances:

  • If the property is disposed of or compulsorily acquired:
    • within six years of receiving a gift or inheritance
    • and
    • is not replaced with other agricultural property. This excludes crops, trees or underwood.

The time limit for reinvesting in replacement agricultural property is within one year of the sale, or six years of the compulsory acquisition.

  • Where the date of the gift or inheritance and the valuation date are on or after 1 January 2015 relief may be withdrawn if you:
    • no longer farm the property for at least 50% of your working hours
    • or
    • do not farm the property on a commercial basis for at least six years from that date.   
  • If the property is disposed of or compulsorily acquired and all of the sale proceeds are not reinvested in other agricultural property. In this case relief will be clawed back in proportion to the amount of money which is not reinvested. If CGT is paid on a disposal, only the net proceeds available after payment of the CGT need be reinvested. 
  • If you do not meet the residency requirements. Before 7 February 2012 these were that you reside in the state for three years after the date of the gift or inheritance. No residency requirements apply on or after 8 February 2012.

Next: How do you claim Agricultural Relief?