Section 598A Relief on dissolution of farming partnerships
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Amendments
Section 598A inserted by Finance Act 2008 section 54(1)(b) as respects disposals made on or after 13 March 2008 until 31 December 2013.
(1) In this section—
"farming" and "trade" have the same meanings as in the Income Tax Acts;
"farming partnership" means a partnership comprised of individuals which carries on or has carried on the trade of farming;
"relevant asset" means an asset which is jointly owned by the partners in a farming partnership;
"relevant disposal" means a disposal which arises on the occasion of the partition of a relevant asset.
(2) This section applies where a relevant asset has been owned and used for the purposes of farming by the farming partnership for a period of not less than 10 years ending with the relevant disposal.
Does relief apply where a farming partnership disposes of an asset?
(1)-(2) The relief in this section applies where an asset jointly owned by the farmers in a farming partnership (relevant asset) for not less than 10 years is disposed of by virtue of the relevant asset being partitioned (relevant disposal).
(3) Notwithstanding subsection (2), where one of the partners acquired his or her share of a relevant asset by way of inheritance, the period of ownership and use of that asset shall be deemed to have commenced on the date on which the person entered into partnership with the other partner or partners in the farming partnership.
(4) Where a relevant disposal arises in respect of a relevant asset, a gain shall not be treated as accruing in respect of that disposal and the relevant asset shall be treated for the purposes of the Capital Gains Tax Acts as having been acquired at the same time and for the same consideration as it was originally acquired by the partner who disposed of that asset.
Am I caught for CGT when farming partnership assets are disposed of?
(4) From the date of passing of the Finance Act 2008, where you are a partner is in a farming partnership and the partnership dissolves, you are not caught for Capital Gains Tax on disposal of a partnership asset owned and used by the partnership for...
(5) This section shall not apply if, until the disposal, the asset formed part of the trading stock of the farming trade carried on by the farming partnership or, if the asset is acquired as trading stock, for the purposes of a trade carried on by the partner acquiring the asset.
