Category Archives: Agriculture

Agriculture

Reducing your January 2017 tax bill when farming profits have reduced

Jordan Brown

With commodity prices fluctuating wildly in recent years, profits (and hence tax liabilities) can also fluctuate from one year to the next. Given the HMRC payment on account system, this can mean that your tax bill is higher than necessary.

Payments on account are calculated as 50% of the prior year’s tax bill, with one payment due by 31 January of the tax year, and the other payment due by 31 July after the end of the tax year.

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Making tax digital for farmers

Stephen Coby

Major changes are being made to the way in which all taxpayers interact with HM Revenue and Customs (HMRC). The Government is referring to these changes as “Making Tax Digital” and they are proposing a staged introduction to the new rules, starting for many in April 2018.

The proposals are wide-ranging, but one of the biggest changes planned is an electronic quarterly report to HMRC of income and expenditure.

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An update on Brexit and implications for farmers

Ashley Smith

The UK’s choice to leave the European Union has both short and long term implications for British farmers and landowners.

Since the referendum result was announced in June, the pound has fallen significantly. This has facilitated an increase in crop prices, which – whilst still below the cost of production for many farms – will provide a welcome cash boost for any farmers with unsold produce from the 2016 harvest.

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Basic Payment Scheme 2016 payments to increase

Terry Want

With lower crop prices in recent years, it will come as a gentle relief that the payments due to farmers from the 2016 Basic Payment Scheme (BPS) will increase by 16.54% when compared to the 2015 scheme monies received.

In brief, this has resulted from a favourable euro to pound exchange rate, being used by the Rural Payments Agency (RPA) for calculating BPS amounts due to those farmers choosing to be paid in sterling.

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New farmers’ averaging rules

Ashley Smith

Legislation is currently being progressed through parliament to enable farmers to choose between averaging their profits over two years, five years or not at all. The rules take effect from the 2016/17 tax year.

Farmers will only be able to average their profits if they meet a volatility test, i.e.

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British Sugar have announced the sugar beet price for the 2017/18 crop

Steven Rudd

The guaranteed minimum price has been set at £22 per tonne and a bonus may be paid on top, depending on the EU sugar price.   Growers can enter into either a one year or three year contract, or a combination thereof. The three year contract will attract a higher bonus.

The bonus will be payable once the EU sugar price exceeds €475 and it is welcome news that farmers will directly benefit when the sugar market improves.

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HMRC review tax-free accommodation

Steven Rudd

HMRC review tax-free accommodation
 

On 14 December, HM Revenue & Customs (HMRC) issued a consultation paper examining the area of “employer provided accommodation.” The intention is “to understand how well understood the rules are, and to what extent they are still relevant and appropriate today.

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