YOUNG FARMERS CAN GET SOMETHING FOR NOTHING!
Law firm Mogers Drewett is advising farmers of the opportunity to claim Young Farmer Entitlements. Up to 90 hectares of free entitlements are available for qualifying farmers over the next 5 years. Young farmers aged 40 and under can be eligible for this uplift if they have a controlling interest in the farm business. Richard Pinney, who leads the agriculture team at Mogers Drewett, is helping young farmers qualify for the uplift at the same time as addressing farm succession plans. The opportunity arises as part of the introduction of Basic Payment Scheme (BPS) which came into force 1st January and replaces the Single Farm Payment Scheme.
One mechanism being used to ensure sons and daughters in family farm businesses can obtain the uplift is to update or redraw the family farm partnership agreement. One of the requirements for qualification is to obtain a certificate from accountants or solicitors to confirm the qualifying criteria have been met. The certificate has to accompany the application to the Rural Payments Agency which for this year has an extended deadline of 15th June.
There is no doubt that the aims of the scheme are to encourage farm businesses to consider succession planning. The main hurdle though is that parents often rely on the farm income themselves and fear handing their life’s work onto their children and losing control. Richard Pinney advises that there are alternatives available to ensure the next generation can increase their involvement in farm management without obliging their parents to retire. As many parents look forward to staying on at the farm, the Mogers Drewett formula really can meet their requirements and get the benefit of a 25% uplift of BPS entitlements.
“This really can be something for nothing,” says Richard Pinney “Especially for family farms already operating as partnerships. Parents should not fear handing over more control to Young Farmers because the business stands to gain a small windfall. The Young Farmer Entitlements are funded from the National Reserve so there really are no losers. Time is short now for claims without penalties this year. The deadline of 15th June approaches fast and I strongly recommend seeking advice from our Agriculture team to get the certificate through in time. ”