Starmer's vision quest

[Dorset Boy]

If Dyson grows a few tomatoes in his garden how much relief does he get?

What relevance is that? It's his garden, part of his primary residence and just like your garden, it is exempt from inheritance tax, though it may start to wipe out his nil rate threshold if his house is worth too much.

 

[monkers]

The solution isn't to let farmers off tax liabilities, it's to pay them a decent income for producing food or otherwise acting in the public interest (rewilding or whatever). The supermarkets have been allowed to get pretty much complete control of prices paid to farmers, and the farming subsidies are a mess in both concept and execution. The trouble is that it's a tiny percentage of GDP, so has little clout with the treasury.

Well said.

 

[midlandsgrimpeur]

If Dyson grows a few tomatoes in his garden how much relief does he get?

Depends, if he likes making tomato sauce he would be very relieved....

 

[Pblakeney]

Any other business can claim Business Property Relief.

With your tax planning wisdom, what should the farmer be doing?
And what are the implications to both their income and the IHT position of your advice to the farmer?

Transfer the ownership in a timely manner?
If daddy farmer is in his 70s then they are doing it wrong. He doesn't have to retire, just not be the owner.

 

[Dorset Boy]

APR and BPR were introduced to stop farms and small businesses having to be broken up or sold to pay the inheritance tax, which then made the future business unviable.

All the Reeves U-turn has done is just give those who use land as an investment an extra £240,000 or so in their net estate.

 

[Dorset Boy]

Transfer the ownership in a timely manner?
If daddy farmer is in his 70s then they are doing it wrong. He doesn't have to retire, just not be the owner.

So if he transfers the business at say 60, he isn't then entitled to any of the profit as he doesn't own the business. It would also sit in his estate for at least 7 years from the date of transfer.

Farms really weren't treated much differently than any other small business before the 2024 budget.

 

[Dorset Boy]

I really think those who don't deal with Inheritance Tax regularly don't understand the wider issue.

 

[Ian H]

True, but that is a separate issue.

What's a separate issue? Paying farmers enough so they can meet their tax bills?

 

[PurplePenguin]

What relevance is that? It's his garden, part of his primary residence and just like your garden, it is exempt from inheritance tax, though it may start to wipe out his nil rate threshold if his house is worth too much.

The relevance is that I doubt your simple solution to establish a true farmer would work.

Separately agricultural land is absurdly expensive and totally unaffordable for tenant farmers, so doing something seems sensible to me.

 

[briantrumpet]

The relevance is that I doubt your simple solution to establish a true farmer would work.

Separately agricultural land is absurdly expensive and totally unaffordable for tenant farmers, so doing something seems sensible to me.

It did strike me at the time that when they first mooted this, they didn't push the idea that taking the heat out of the agricultural land market could be beneficial to farmers who actually want to buy land as a means of producing food profitably. I suspect, OTOH, a lot of borrowing has been predicted on astronomically high land prices: the farmers I know/have known I suspect all to often add in a massive premium above the direct return, because of an aspirational aspect of increasing the farm size, whether or not the expansion will actually provide a proportional return.

 

[CXRAndy]

100-200 acre farms are almost working for non profit. Add in unfavourable weather, wet, cold, dry, too hot at the wrong time of the season, losses are almost inevitable.

 

[BoldonLad]

100-200 acre farms are almost working for non profit. Add in unfavourable weather, wet, cold, dry, too hot at the wrong time of the season, losses are almost inevitable.

In any other business enterprise, if it could not make a profit, or, at least sustain the business owner, the answer would be "the business is not viable".

Why should Agriculture be any different?

Why should we subsidise Farming, but, not, (say), shipbuilding, car manufacture, TV manufacture, horseshoe makers, candlestick makers?

Why should farmers have different IHT treatment to the rest of us?

 

[Dorset Boy]

Why should farmers have different IHT treatment to the rest of us?

They don't psrticularly when compared to other small business owners. That is one of the points spectacularly missed by posters in this thread who have a limited understanding of IHT.

Also, we do need to eat to survive.

 

[CXRAndy]

In any other business enterprise, if it could not make a profit, or, at least sustain the business owner, the answer would be "the business is not viable".

Why should Agriculture be any different?

Why should we subsidise Farming, but, not, (say), shipbuilding, car manufacture, TV manufacture, horseshoe makers, candlestick makers?

Why should farmers have different IHT treatment to the rest of us?

A lot of these farms are multi generation. They are their homes as well.

Many many industries are/were subsidised.

Do you want to be reliant on foreign food imports?

God forbid there was a major global conflict and UK could not grow its own food.

 

[Ian H]

In any other business enterprise, if it could not make a profit, or, at least sustain the business owner, the answer would be "the business is not viable".

Why should Agriculture be any different?

Why should we subsidise Farming, but, not, (say), shipbuilding, car manufacture, TV manufacture, horseshoe makers, candlestick makers?

Why should farmers have different IHT treatment to the rest of us?

If we want farmers to work for the public good, we should pay them to do that.