23 Nov 2016
IFA SEEKS CLARITY FROM REVENUE COMMISSIONERS ON LETTER TO KERRY CO-OP SUPPLIERSDairy, Farm Business & Credit
IFA President Joe Healy has contacted the Revenue Commissioners about the recent communication received by a number of Kerry Co-Op suppliers relating to the income tax treatment of co-op shares that they had purchased between 2011 and 2013, as milk suppliers to the co-op.
Joe Healy said the information contained within the letter and the demand for a voluntary disclosure within 21 days, has caused considerable concern and anxiety among the farmers in receipt of the letter. “Providing farmers with 21 days’ notice as the first means of communication on the issue is simply not acceptable. The timeframe for farmers to get clarity on the issue, and to engage with Revenue, is too short and must be extended.”
In addition, greater clarity is required on the value that Revenue has ascribed to these patronage shares, and the resulting income tax liability that has been arrived at. Farmers purchased the shares at a value of €1.25/share. It was the clear understanding of farmers that this was the value of the shares and that any tax liability would arise at a future point, when these shares were disposed of. For many years, farmers have paid Capital Gains Tax on the full gain in value of their shares, i.e. the difference between the €1.25 purchase price and the price at which they were disposed.
Joe Healy said it is only fair to farmers that they should be given more time, without penalty, to respond to the Revenue communication than is currently set out.