Exploring land purchase options for limited companies
30% of farmers in Ireland have purchased land in the last 10 years, with 42% of these purchases being made by dairy farmers. A large number of these acquisitions involved limited company structures.
Investing company funds in agricultural land can help farms grow and diversify. It sounds like a brilliant idea, in theory, but it comes with a host of complications and challenges you’re going to need to think about very carefully. The right way to go about it for you will boil down to your goals for the land, your family plans, and, of course, your finances.
The story first appeared in our 2025 Irish Farm Report.
Discover more insights like this in our 2025 Irish Farm Report – Download Now!
Paddy Cowman, Tax Director
One of the first questions farmers ask themselves revolves around whether to buy land through their company or as an individual. The tax difference between these two options is huge, whatever lens you look at it through.
• Buying through the company: If your company earns €100,000, it pays €12,500 in corporation tax, leaving €87,500 to reinvest. This low tax rate makes it much cheaper to use company money for land purchases.
• Buying as an individual: Taking €100,000 out of the company to buy land means paying income tax, USC, and PRSI, which could amount to up to 55%. After taxes, you might only have €45,000 with which to buy land.
The Bottom Line
Using company money is more tax-efficient, but personal ownership may work better for passing the land on to family.
So what should be your next step?
Well, your next step is going to be considering the four topics covered above, and weighing up the pros and cons of each.
1. Work with your accountant to compare the tax implications of buying land through the company versus extracting money for a personal purchase.
2. Factor the 7.5% corporate stamp duty rate into your calculations. If the land purchase you have in mind is relatively small, individual ownership could save you money.
3. Think about the long term today. Decide whether the land will be used for business or kept in the family. This will help determine if it is better for you to own the land or your company.
4. Review whether the land’s ownership status and use qualify for agricultural relief. Small details, like actively farming the land, can make a big difference to tax savings.
The best option for you depends on your goals and family plans
Buying land through a limited company can save on taxes, but it makes succession planning more complex. Personal ownership gives more flexibility for family planning but it costs more upfront due to taxes.
Speak to your accountant and solicitor before making any big decisions. They will be able to help you structure the purchase in a way that saves money now and makes the most sense for your long-term plans.