CGT & IHT Relief for Farmers & Landowners - Managing the Risks

Introduction

Farming has benefited from generous IHT and CGT reliefs for a number of decades. Such benefits have encouraged many investors and ‘lifestylers’ to purchase farms and landed estates resulting in strong values. The ‘rollover buyer’ has been prominent in farm purchases. We focus on the taxation of farming for the environment and ELMs (Environmental Land Management) subsidies as mentioned in the Spring Budget 2023 and 2024 and is now the subject of a working group. We look at CGT and IHT guidance in the gap before full HMRC guidance. The 2024 Budget has confirmed APR on environment projects from 2025.

HMRC have blatantly attacked anyone taking advantage of the generous CGT/IHT reliefs particularly with regard to ‘investment’ and ‘landlord’ status together with any private use - tax advisers have been kept very busy by this approach. A good deal of farm succession planning is based on the historically strong capital tax reliefs. We consider the recent Butler case of the wedding barn and the impact on planning for ill health and farm diversification being held to be an investment.

This virtual classroom seminar looks at the certainties and uncertainties of CGT & IHT relief for farmers & landowners embracing what action can be taken now and tax planning around the risks of uncertainty and maximising the criteria to achieve the relief.

What You Will Learn

This live and interactive session will cover the following:

• Consideration around the Budget 2023 & 2024 announcements of the working group review on eco system/ELMs and APR to be extended for ELMs from 2025
• Review of what to do with APR/BPR relief claims in the gap before the results of the working group
• The importance of CGT/IHT planning before contract signed, especially new ELMs agreements
• Impact of the Rock Review and 8 year FBT and APR rejection
• OTS reports on IHT and CGT - APPG report on IHT
• The impact of farming for the environment on all IHT and CGT planning and the practical impact on probate
• The importance of the farm partnership agreement for IHT and CGT protection amongst all the updates and the impact of TRS (Trust Registration Scheme)
• 50% BPR on non-partnership property
• 50% APR on AHA tenancies
• Tenancy reform - the impact on IHT AND CGT planning
• CGT on tenant farmers surrendering tenancy for capital sum
• CGT and IHT planning on farmers selling large and small development areas (Foster case)
• CGT landing around deferred consideration
• CGT and IHT protection around option and promotion agreements
• Farm survival post the subsidy gap the importance of the tax efficient development gains, diversification and succession planning
• IHT protection of grazing agreements (Gill case)
• IHT efficiency of the Contract Farming Agreement (CFA) and all potential farming agreements, e.g. Share Farming and Joint Ventures - the pressure post Rock Review
• The Farm Will and practical probate consideration as part of IHT succession planning
• Lifetime gifts of the farm, holdover relief and gifts with reservation of benefit
• The IHT and CGT efficiency of the ‘lifestyle buyer’

Recording of live sessions: Soon after the Learn Live session has taken place you will be able to go back and access the recording - should you wish to revisit the material discussed.