Farming & Rural Business Community articles

Recent changes to HMRC working practices seem to have thrown up an anomaly where there are one or more trades (some of which carry brought forward losses) and employment or pension income. Immediately after the submission of a SAR, the total self-employment income, without allowing for future loss reliefs, is taken into account in coding, which has the effect of restricting personal allowances. The problem can be rectified within the taxpayer account but it is not straightforward.

Behind the main Budget announcements, a few other matters of rural interest can be found.

In a largely unannounced move, the RPA have recently (5 November) paid out a compensation amount to holdings within areas affected by flooding last winter. The claims are calculated automatically and require no evidence of damage and no evidence of land remediation. You will find that clients have received letters similar to that copied below.

The recently published details of forthcoming reforms to the tax treatment of Furnished Holiday Lettings (FHL) income, which were initially announced in the 2024 Budget but omitted from the Finance Bill, signal significant changes effective from the end of the 2024/5 tax year. These reforms, which were announced on 30 July, were confirmed as part of the 2024 Budget package.

Now that the dust has settled, at least temporarily, on the Autumn Budget, it is worth looking at the implications for those taxpayers who are likely to be affected.

On the whole, Rachael Reeves first Budget has not been received well by the farming community. The NFU said “APR changes would put family farms at risk”, Victoria Vyvyan, president of the Country Land and Business Association, said the change was “nothing short of a betrayal” and the Guardian summarised that “farmers in England must do more with less”. In contrast, food security Minister Daniel Zeichner said: “our commitment to farmers and the vital role they play to feed our nation remains steadfast."

Solar panels have dominated the renewable energy sector for many agricultural clients, often utilising unused roof space to provide clean and lower cost energy. This has been of particular importance in recent years with the large rise in energy costs, especially when farm buildings can be energy intensive. Energy storage can be expensive or not possible, meaning the peak energy generation often doesn’t align with the demands of the farm, such as for running cold stores over winter and spring. Wind turbines could be the solution.

As the dust settles on yesterday’s Budget, we have much to think about.

As I write, the combines continue to roll in the North East of England. After a wet Autumn, Winter and Spring, this harvest was always going to be a difficult one. Many of my farming clients will be relieved once harvest 2024 is completed. They also know they are lucky compared to farmers further South who were forced to write off crops in the Spring. Pressures on cash flow will continue to be a focus for farming businesses.

ICAEW’s revised CPD regulations came into effect on 1 November 2023. Here’s some helpful information to get started.