Budget 2027: what changes on your farm, and when

Budget 2027 was announced on 6 October 2026. For Irish farmers the big one is succession. The Succession Farm Partnership tax credit doubles to €10,000 a year, but only for partnerships registered from 1 January 2027. The VAT flat-rate addition rises to 4.8%. Green diesel's carbon tax increase is deferred again. Most measures still need the Finance Bill.

That last point matters more than it sounds. And one of these changes is worth up to €25,000 to the right farm, purely on the date you register.

What actually changed for farmers in Budget 2027?

Here are the measures that touch a farm, with the date each one starts. Everything in this table comes from the Department of Finance's Budget 2027 Tax Policy Changes document or the Budget 2027 expenditure reports.

Citizens Information carries the standing caveat on all of it: some elements may change when the legislation needed to bring them in is enacted. Nothing here is law yet.

Why the succession credit is a decision about a date

A Succession Farm Partnership is an income tax credit for handing the farm business on. DAFM's own scheme page sets out how it works. It is an annual credit, for up to five years. It is split between you and your successor by your profit-sharing ratio.

So the credit was worth up to €25,000 over five years. At €10,000 a year it is worth up to €50,000.

Read the Budget wording closely. The higher credit is available for partnerships registered from and including 1 January 2027. Register in December and you are on the old rate for the whole five years.

That is a gap of up to €25,000, decided by which side of New Year's Day the registration falls on.

The three-year holding period is going too, and it follows the same rule. Until now your legally binding agreement had to put the transfer in a window starting three years after you applied. That is removed for applications made from 1 January 2027 onwards, and it does not apply to anything filed before that date.

If you are in the middle of this, talk to your advisor before you lodge anything.

Waiting is not right for every farm. Your successor may be close to 40. Health or a farm sale may be forcing the pace. The old rate on a completed deal beats the new rate on one that falls through.

What you should actually do about it

The paperwork takes time, which works in your favour here.

An SFP application needs a five-year business plan. It also needs a legally binding agreement to transfer at least 80% of the farm assets. The Teagasc My Farm My Plan booklet has to be completed too, and Teagasc certifies that plan.

So start now and register in the new year. You are not delaying anything by doing the groundwork in October, November and December.

Two conditions catch people out. One partner must have farmed at least 3 hectares in their own right for the two previous years. The successor must be under 40, hold an agricultural qualification, and be entitled to at least 20% of the partnership profits.

Succession is the part of farm admin people put off longest. We looked at how AI can help you get a succession conversation started if that is where you are stuck.

What is the VAT flat rate rise worth on your farm?

This one is simple arithmetic and nobody does it for you.

The flat-rate addition compensates farmers who choose not to register for VAT. You add it to what you charge VAT-registered buyers — the co-op, the mart, the factory — and you keep it.

The 2027 rate is 4.8%, up from 4.5%. That is 0.3 percentage points.

Multiply your annual sales to VAT-registered buyers by 0.003. That is your number.

• €80,000 of sales: €240 a year
• €150,000 of sales: €450 a year
• €300,000 of sales: €900 a year

The Department of Finance costed the change at €23 million in the first year and €28 million in a full year. On those costings it is the biggest single farm tax measure in the Budget. It is also the one nobody has to apply for.

Why did the farm budget fall and rise at the same time?

You will see both claims across the Irish farming press this week, and both are defensible. Here is the reconciliation.

The Department of Agriculture, Food and the Marine gets €2,344 million in total for 2027 — €2,019 million current and €325 million capital.

Set against the 2026 allocation, current spending falls by €61 million, or 3.0%. Capital falls by €12 million. That is the cut you will see quoted.

But the expenditure report's own footnote explains it. The 2026 figures are the latest Estimate brought before the Dáil, and "may include temporary allocations made for 2026 only." Strip those one-offs out, and the Department says it has an extra €39 million in current expenditure for 2027.

Both numbers are real. One compares against a year that carried emergency money, the other against the standing base.

Where the 2027 money goes:

If you are weighing a TAMS application against that €93.4 million, our piece on TAMS 3 rates and your odds of approval has the detail. The ACRES figure sits alongside everything else we have published on the scheme in the ACRES hub.

What happened on bovine TB?

The bTB programme gets €142.4 million for 2027, to fund additional testing and movement controls under the LEAN review of the programme.

The measure that puts money in a farmer's pocket is the valuation change. The expenditure report commits to increasing the existing valuation ceilings by €500 for all reactors valued in 2026.

Read that date again. It is reactors valued in 2026, not 2027.

The Department plans 10.7 million bovine TB tests on cattle in 2027.

We could not find DAFM scheme detail on how the increase will be applied. Check gov.ie before you budget around a specific valuation.

What about green diesel and fuel costs?

Marked gas oil gets another reprieve. The carbon tax increase originally set for 1 May 2026 was already deferred, and it is now pushed to 1 May 2027. The increase that was due on 1 May 2027 moves to 13 October 2027.

Petrol and auto diesel follow the same pattern. The rise due on 14 October 2026 is deferred to 1 May 2027, with a further increase on 13 October 2027.

Carbon tax on kerosene and natural gas is cut to €48.50 per tonne of CO₂ and held there until 2030.

Separately, Minister Chambers confirmed the Fuel Income Support Scheme in his Budget statement. The scheme for farmers and agricultural contractors is extended by a further five months, at a cost of €31.2 million. A new €31 million fertiliser scheme, announced on 6 October 2026, is due to launch before the end of the year.

What did not change?

Worth knowing, because the absence was not announced.

The Tax Policy Changes document makes no change to stock relief, young trained farmer relief or consanguinity relief. They are unchanged by this Budget, which is not the same as being secure for ever — each has its own expiry date in legislation.

The accelerated capital allowance for farm safety equipment did get extended, by three years to 31 December 2029. Twelve items were added to the eligible list. That allowance runs at 50% a year, so check the new list before you buy.

Where to get help

Your Teagasc advisor is the first call on succession partnerships and on whether an SFP suits your farm at all. The My Farm My Plan booklet has to go through Teagasc anyway.

For the registration itself, DAFM's Farm Partnership Unit takes applications and queries on 01 6072857.

For the tax side — the flat rate, the capital allowances, CGT and CAT — that is an accountant's call, not an advisor's.

Frequently asked questions

Should I delay registering a Succession Farm Partnership until January 2027?

If the higher credit matters to you, yes — the Budget restricts it to partnerships registered from 1 January 2027. The application needs a five-year business plan and a legal agreement anyway, so the preparation time is not wasted. Take advice before you lodge anything.

Do I need to apply for the VAT flat rate increase?

No. The flat-rate addition is the percentage you add to sales to VAT-registered buyers, and the 2027 rate is 4.8%. There is no application.

Is the €500 bovine TB valuation increase automatic?

The expenditure report commits to raising the ceilings by €500 for all reactors valued in 2026, but DAFM has not published the operational detail. Do not assume a figure until the Department confirms how it applies.

When do these changes become law?

The Finance Bill follows the Budget and can change the detail. Citizens Information carries the same warning on every Budget measure.

The bottom line

If succession is anywhere on your horizon, start the SFP paperwork this month. Register it in January, not December. Everything else in Budget 2027 happens to you. That one you have to time.