FARMERS have been strongly advised to have a financial contingency plan in place in the event of their herd experiencing a Bovine TB breakdown.

According to the Ifac farm accounting services firm, farmers need to be aware of what their financial options is such a breakdown occurs on their farm.

There are a number of compensation schemes in place for farmers to help manage the economic impact of a Bovine TB breakdown and Ifac are advising farmers affected to make an early contact with the Dept. of Agriculture [DAFM].

Philip O’Connor, Head of Farm Support at Ifac advised that understanding and actively engaging with these support mechanisms can help manage the financial impact of a TB breakdown.

“Planning ahead is crucial, and we are advising farmers to take a number of key steps to protect their financial position during a TB breakdown,” he said.

Some of the key things for farmer to do in these situations include: maintaining detailed records of all affected animals; contacting your RVO [Regional Veterinary Office] promptly regarding any planned animal movements; and considering the impact on cashflow with your financial advisor.

Philip O’Connor also advised farmers to review their eligibility for all available compensation schemes; to keep track of testing dates and requirements to minimise the restriction period; and to engage with their bank early and especially so if they have repayment obligations that may be affected by the breakdown. Some of the main compensation options that are available to farmers include:

■ On-Farm Market Valuation. The specific valuation ceilings [maximum payments] peer animal are: Standard reactor animals, €3,000. Stock bulls, €4,000. Pedigree stock bulls, €5,000.

■ Tax Implications of TB Compensation. Farmers can claim tax relief for compulsory stock disposal if they replace the animals within four years and defer the tax even if the stock are not replaced.

■ Exit from Farming Considerations. Where an election to defer the income is made but within the 4-year period, the farmer decides to fully destock and cease farming entirely, then in the year of cessation, any amount of the deferred income which has not yet been charged to tax will become subject to tax in that year.

■ Stock Relief and Reinvestment. Where a farmer receives any income under the compulsory disposal of cattle, that farmer may elect to have the ‘profit’ they make on the disposal of those animals deferred over a 4-year period.

■ Income Supplement Scheme. This provides monthly payments for farmers who lose 10% or more of their herds. The rates [monthly] per reactor animal are: dairy cows, €55; suckler cows, €38. Other cattle, €25.

■ Hardship Grant Scheme. A winter targeted scheme, November 1 to April 30, for farmers who are restricted more than 60-days; who have no off-farm income [state pension is exempt]; and a full herd re-test must be completed within 60-days. The monthly rates per retained animal are: suckler cows, €38; dairy cows, €25; other cattle, €25. This requires a special application [Form ER97 from your RVO].

■ Depopulation Compensation. Applies to severe cases where full or partial herd depopulation is necessary. Dairy stock, excluding calves: €220 per animal. Sucklers, excluding calves, €152 per animal. All other animals: €76 per animal.

Pictured: Philip O’Connor: Planning ahead is crucial.