The Prime Minister’s announcement that the UK will not have a half-in, half-out deal, means the subsidies UK farmers currently receive from the EU will cease. Whilst the UK government has pledged the same level of support for famers until 2020, no guarantees have been given beyond then.
As a result, rural services lawyers at local solicitors Moore Blatch is already seeing famers and landowners looking to secure their long term future, and income, from other means. Many have already looked to diversify, typically this includes letting of farm buildings for non-farming use, such as holiday lets or for sports and recreational or retail use.
However, the lawyers warn that farmers, whose average age is now around 67 could risk losing tens, or hundreds of thousands of pounds in the long run, if such diversification is not done properly as many forms of diversification would not qualifying for Agricultural Property Relief from inheritance tax.
Philip Whitcomb from Moore Blatch says: “Our Rural Services team has already dealt with a number of cases where famers and land owners look to diversify their income stream, from installing solar panels and wind farms to using farm buildings for holiday lets. With the current level of support for farmers looking increasingly vulnerable, we expect to see a growth in diversification in the use of farm land. However, diversification comes with risks, specifically farmers’ ability to qualify for Agricultural Property Relief from inheritance tax as this often does not apply to many forms of diversification and can be worth tens or hundreds of thousands of pounds.”