More Irish farms now trade through a limited company, and some agri businesses, such as contractors and small processors, have always been companies. Borrowing as a company is different from borrowing as an individual farmer. This guide explains why farms incorporate, how lenders look at a farm company, which types of finance are commonly used and where our own service fits. It is general information, not tax, legal or financial advice.

Why do farms set up a company?

Farmers usually incorporate for tax and business planning reasons, and the right answer depends on your own figures. Talk to your accountant or a Teagasc adviser before you make any change.

Teagasc's 2018 guide, Farming Through A Company, sets out the main points farmers weigh up. On the plus side, profits kept in the company are taxed at the company rate rather than at personal rates, and that money can be used for spending on the business, paying down debt or directors' pensions. On the other side, Teagasc lists extra paperwork and regulation, higher accountancy costs, possible tax complications if the business or its assets are sold later, and the chance of a tax bill when moving from sole trader to company. It also says a short run of high profits may not justify the change.

The same guide notes some practical points that matter to lenders later:

  • Land can stay in the owner's name and be leased to the company.
  • Livestock and machinery can be transferred into the company, and payment entitlements (Basic Payment entitlements in 2018, now BISS) can be leased or transferred to it.
  • Existing loans can be moved to the company, but the asset behind them may also need to move.
  • The company must prepare annual accounts, file them with the CRO and file its own corporation taxThe tax Irish-resident companies pay on their profits. return.
  • The Department of Agriculture, Food and the Marine must be told about the change, including the herd number and entitlements.

We cannot advise you on whether to incorporate or how to structure it. Your accountant can.

How do lenders look at a farm company?

Lenders assess a farm company like any other trading company: they want to see that it earns enough, steadily enough, to repay. The main difference is that farm income rarely arrives in equal monthly amounts.

Accounts and bank statements

Filed accounts show the company's turnover, profit and what it owns and owes. Recent business bank statements show how money moves in and out month to month. If the company is newly formed from an existing farm, a lender may ask about the trading historyHow long a company has been actively trading, and the record of that trading shown in its filed accounts, bank statements and tax returns. before incorporation, but each lender sets its own rules on this. Keep company and personal money in separate accounts; it makes any application much easier to assess.

Seasonality

Milk cheques arrive monthly, but cattle sales, grain and lamb sales come in lumps, while fertiliser, feed and contractor bills often peak at other times of the year. A short note explaining your cash cycle, with a simple cash flow forecast, helps a lender understand why your bank balance swings. Our working capital calculator can help you think through the gap.

Scheme payments

The Department of Agriculture describes the Basic Income Support for Sustainability (BISS), which replaced the Basic Payment Scheme, as a direct income support for farmers, based on payment entitlements. Its scheme page says an advance payment may be made in October, with balancing payments starting in December. How any lender treats scheme payments when it assesses affordability is the lender's own decision, so ask each one directly.

Security and land

If your land stays in your own name and is leased to the company, the company's balance sheet may hold fewer assets. Many smaller business loans are unsecured, but lenders may still ask directors for a personal guaranteeA legally binding promise by a director or other individual to repay a company's debt if the company cannot.. Read our guide to personal guarantees for company loans before you sign one.

What types of finance do farm companies use?

Most farm company borrowing falls into a handful of types. Each is explained briefly below, with a note on whether our panel may be able to help.

Working capital

A working capital loan covers the gap between paying bills and getting paid, for example carrying stock over the winter. This is within what our panel may consider. See working capital finance and our new page on agri working capital.

Stock and inputs

Some lenders pay a supplier directly and let your company repay over a few months. This usually suits goods your company sells on, such as stock for an agri merchant or retail business, rather than inputs used on the farm. Stock and supplier-payment finance are within what our panel may consider, subject to each lender's own rules. See stock finance and trade finance.

Machinery and equipment

Tractors, trailers, milking equipment and other machinery are usually funded through hire purchaseA form of asset finance where the company pays for an asset in instalments, often after a deposit, and takes ownership once the final payment and any option-to-purchase fee are made. or leasing, where the machine itself is the security. Our asset finance pages explain how it works.

State-backed loans through the SBCI

The SBCIA State-owned body that makes low-cost funding and loan guarantees available to Irish SMEs, farmers and fishers through participating banks and non-bank finance providers.'s Growth and Sustainability Loan Scheme is open to viable SMEs, including farmers, fishers and foresters, that meet its rules. The SBCI says loans run from €25,000 to €3,000,000 over 7 to 10 years, and are unsecured up to €500,000, subject to certain exceptions. You first apply for an eligibility code on the SBCI Hub, then take it to a participating lender such as AIB, Bank of Ireland or PTSB. The code does not guarantee a loan. The SBCI says the scheme is open until 30 June 2029 or until it is fully subscribed.

Welcome Finance does not arrange SBCI loans and cannot get an eligibility code for you. Our SBCI loan scheme guide explains the process.

Bridging a TAMS 3 grant

TAMS 3 grants are paid after the work is done, not before. Teagasc's TAMS guidance says grant payment is not issued until all works are complete, receipts marked paid are submitted and final inspections are completed, and that bridging financeShort-term funding used to cover a gap until another source of money arrives, such as a sale, refinancing or longer-term loan. is usually needed until the grant arrives. The Department's 2026 scheme terms add that works must be completed and claimed within 12 months of approval, that only one payment claim is allowed, and that payments from an account not held by the applicant are not eligible. Grant rates are 40% or 60%, depending on the scheme and the applicant (70% under the Nutrient Importation Storage Scheme), and ceilings on eligible costs apply. For a company, the application is made by the company directors.

Illustrative example: a farm company has approval for €50,000 of works at a 40% grant rate. It must pay the full €50,000 to its suppliers first, then claim €20,000 once the works are finished and inspected. Short-term funding can cover that gap, but the full amount still has to be affordable if the grant is delayed or reduced. A short-term business loan may be one option for a limited company.

Land, farm buildings and what we do not arrange

Buying farmland or farm buildings in the company's name, or borrowing against land and buildings the company owns, is property finance for the company. Welcome Finance does not arrange property finance such as commercial mortgages and bridging loans. Banks lend for this: PTSB, for example, may consider terms of up to 20 years for agricultural land on its Business Mortgage Loan, so speak to your bank or a property lender directly.

We never help with anything secured on a farmhouse or any home someone lives in, or with a loan to a farmer as an individual. If your land stays in your own name and is leased to the company, a lender may ask you for personal security; take independent legal advice, as that is between you and the lender.

What can sole-trader and partnership farms use instead?

If your farm does not trade as a company, these routes may be worth a look:

Your Teagasc adviser, accountant or co-op may also know of local or sector schemes.

How honest are we about our panel's limits?

Very. Our panel is five specialist non-bank lenders: 365 Finance, Flurish, Linked Finance, Treyd and Triffin. They may consider unsecured and short-term loans, working capital loans, merchant cash advanceA form of finance where a provider advances a lump sum in return for a fixed percentage of the company's future card takings until an agreed total is repaid., revenue-based financeFunding repaid as an agreed share of a company's future revenue rather than through fixed monthly instalments, so repayments flex with sales., stock financeFunding used to buy stock or inventory, where the lender pays suppliers or advances against stock held and the company repays as goods are sold. and trade or supplier-payment finance. Welcome Finance does not arrange SBCI loans. None of the panel lenders names livestock purchase as a use on its website, and each sets its own criteria on trading history, turnover and use of funds. Some farm companies will fit well; others will be better served by a bank or agri lender.

Tell us what your company needs and we'll tell you honestly whether our panel can help, or where to look instead. You can start with our eligibility check. There is no credit search at that stage, and approval is never guaranteed.