Taxes Consolidation Act 1997 section 598A

Relief on dissolution of farming partnerships

Section 598A provided relief from capital gains tax on the dissolution of a farming partnership, where a jointly owned asset was partitioned among the partners.

• Where a farming partnership dissolved and a jointly owned asset was partitioned, no capital gains tax arose on the disposal, provided the asset had been owned and used for farming by the partnership for at least 10 years.
• Where a partner had acquired their share of the asset by inheritance, the 10-year ownership period was measured from the date they joined the partnership, not the date of inheritance.
• The asset was treated as having been acquired at the same time and for the same consideration as the disposing partner originally acquired it, preserving the original base cost.
• The relief did not apply where the asset was held as trading stock of the farming partnership or of a trade carried on by the partner acquiring the asset.