Taxes Consolidation Act 1997 section 657A

Taxation of certain farm payments

Section 657A (now repealed) provided for a special three-year spreading arrangement for certain EU farm payments received in 2005, arising from the transition to the Single Farm Payment scheme.

• The section applied to farmers who received both a payment under one of the old FEOGA schemes and a payment under the new Single Farm Payment in 2005, and who were not already using income averaging under section 657.
• A qualifying farmer could elect to have relevant FEOGA payments received in 2005 treated as arising in three equal instalments — one third in the year the payment would otherwise be chargeable, one third in the following year, and the final third in the year after that.
• The election had to be made in writing, on or before the return filing date for the year the payment was received, and submitted with the income tax return for that year; once made, the election was irrevocable.
• If the farmer permanently ceased farming before the spreading period was complete, any amount not yet charged to tax became chargeable under Case IV of Schedule D in the year of cessation.