Lifestyle Farm Purchases & Estate Planning - Tax Planning Pros & Cons

Introduction

The figures produced by farmers weekly and the land agent's websites are that of all the farms being bought in the UK, 50% are from non farming backgrounds or what is termed ‘lifestyle buyers’.

This webinar explores the tax advantages and tax pitfalls for those new buyers - entrepreneurs possibly ‘rolling over’ gains from the sale of their business into their dream buy with robust potential tax advantages. Conditions must be met to achieve the tax relief. One arm of such lifestyle farmers are the woodland investors.

Many have been buying poor agricultural land together with marginal areas of farmland such as hill farms in Scotland and Wales using rollover relief and then planting trees in return for strong subsidies and the sale of carbon credits.

Other types of ‘lifestylers’ are those who want the benefits of the ‘long drive’ and recreation e.g. shooting. There are also those wanting to recreate ‘rewilding havens’.

The range of buying incentives can be a range of tax reliefs, subsidies, somewhere very beautiful to live, together with tax efficient capital appreciation.

What You Will Learn

This short webinar will cover the following:

• The rollover buyer - CGT mitigation on purchase of farm business assets
• Escaping IHT on a large amount of wealth through a trading farm
• The romance of not paying IHT on the house you live in plus some let property
• Not too many investments the need for profitable trading
• Reclaiming a large amount of input VAT on purchase - mindful of restrictions
• The SDLT advantages of commercial property - the HMRC attack on mixed rate SDLT
• The ability to claim trading losses sideways (restricted to 25% of income)
• Hobby farming rules - there must be a business plan that is reviewed
• The vineyard and cider making - now qualify for APR
• The woodland investor - sale of carbon credits
• The impact of a purchase with tenancies
• The tax advantages of the stud purchase - the drop of the 11-year hobby rule
• The trendy glamping and holiday accommodation craze - tax protections
• Research & development - the advantage of the entrepreneurial approach

This webinar was recorded on 6th December 2022