Following on from the Budget, why shouldn't Farmers pay inheritance tax like the rest of us?

[oldypigeonpopper]

On 10/11/2024 at 09:52, ehb102 said:

The thing that no one wants to talk about is that farmers do us the favour. The population needs to eat. We can't always rely on cheap imports of food and if we relied wholey on them we would starve. What happens if something happens and imports are no longer possible? War, environmental changes, anything out of a John Wyndham book. 

Then again farmers are being slightly disingenuous. If you set your farm up in a trust so it may only be a farm and it is protected so you may never sell any part of the land, it must always remain a farm then you can't just sell off a few acres for a couple of houses every time you want to marry off a daughter or buy a new milking parlour. They want that autonomy. And that would mean having it both ways. 

Hello, My friends farm gave up milking years ago, Sold the Quota and now Parlour redundant as they could not make it pay ??

[Agriv8]

My parents are in that nice house category John bought a house we never had much growing up but were clothed and fed !

A nice farming analogy that I don’t think our new Labour gov have grasped

Taxation, gentlemen, is very much like dairy farming. The task is to extract the maximum amount of milk with the minimum amount of moo.

Terry Pratchett, Jingo (Discworld, #21; City Watch, #4)

Agriv8

[old man]

20 hours ago, Agriv8 said:

My parents are in that nice house category John bought a house we never had much growing up but were clothed and fed !

A nice farming analogy that I don’t think our new Labour gov have grasped

 

Taxation, gentlemen, is very much like dairy farming. The task is to extract the maximum amount of milk with the minimum amount of moo.

Terry Pratchett, Jingo (Discworld, #21; City Watch, #4)

Agriv8

Mm, as a leveller. Maybe the biggest mistake any voter can make is to think that the receiving politician is legal, decent and honest?

Most are not and respond avidly to their masters whims without a care for the voters original wish? 

Politics is just a well paid play group?

[oldypigeonpopper]

Hello, Like Thatcher, Starmers not for turning, 🤔

[TIGHTCHOKE]

Well fancy that........................................................

Two Tier Kier ran away.

https://www.independent.co.uk/news/uk/politics/starmer-budget-family-farm-tax-b2648253.html

[Dave-G]

To be fair though, how many PM's address protesters during and at their protest location?

[KPV4]

There are two things that are certain in life - death and taxes…!!

With the latter it has to be fair, everyone is working to benefit their family in death and farming is no different, so should be subject to the same taxes as the rest of the hard working population… farming is a business, so must be subject to the taxes in death that other business owners and the general public are subject to, and always should have been, as it would have given more opportunity for the younger generation.

Those who have purchased large farms, or bought extra land to evade the tax system, then they will now have to pay their taxes like the rest of us. The new proposals are still more favourable to farmers than everyone else.! So why keep complaining, you didn’t have these exceptions before 1984…. I know many farmers, yes it’s hard work 365 days a year, but there are many benefits, as has been posted before, lots of new £60k plus vehicles floating around, all in the tax reclaim system…. Jo blogs doesn’t have these benefits… perhaps it’s time farmers actually looked how well off the majority are, there are lots of benefits and tax breaks they get, just like other business owners that jo blogs on the street doesn’t get. I’ve no problem with that, but lets stop moaning about the new changes.

Everyone is talking about £1M threshold, if the farm is in joint ownership with a spouse it moves to a £3M threshold, if it’s only in one name or isn’t being transferred to family under the 7 year rule which applies to us all,  I have to ask why..? Is there little trust issue between farmers and their families.?. if so why…? I know a solicitor very well who informs me he hasn’t had time to sleep since the budget… the phones are red hot in the office, with farmers trying to find ways around the new tax rules..!!!! That tells me a lot… The old saying is right - “have always wants more”……!!

Maybe the chickens (in those large sheds) are now coming home to roost..! 

[TOPGUN749]

On 09/11/2024 at 20:56, 39TDS said:

Still means the end of the business and livelihood but I think more importantly means the end of that family farm. As Kier said "It can't come back", I really do think that should be a national concern but nobody seems to care.

 

That £350k is £500k if left to offspring.

£325,000 threshold if no wife or children.

[JohnfromUK]

57 minutes ago, TOPGUN749 said:

£325,000 threshold if no wife or children.

The other key issue is that IF the farm owner chooses to give away the property and (hope to) live for7 years to remove the Inheritance Tax (IHT) liability - there is another tax that does apply.

If someone 'gives' away any property, there is (unless it is the prime dwelling house) Capital Gains Tax (CGT) due.  Note that this applies on gifts as well as sales, because the tax is levied on a 'disposal'.

If the farm in question is a long held family farm, the CGT is probably chargeable on the change in value from when the current owner inherited it from his predecessor to the date of the gift (and also includes inflation!). CGT is currently 18% or 28%.

Hence this idea that a farm can easily be given away tax free under the "7 year rule" is NOT TRUE.  It is true that it can be free of IHT, but it is very far from tax free as both CGT and Stamp Duty are probably payable.  Potentially, that could well be over the 20% of IHT that would be due.

In addition, there is the risk that if the owner transfers the farm to use the 7 year rule, and pays the CGT and Stamp duty, then dies before 7 years has passed, IHT will be payable AS WELL ........ so it ius a very risky thing to do for an older person.

[TOPGUN749]

Some farmers have said they can get cheaper cartridges for their clay shooting by reclaiming the vat. So while most of us pay £300 a thousand, they pay £250.

[Scully]

1 hour ago, TOPGUN749 said:

Some farmers have said they can get cheaper cartridges for their clay shooting by reclaiming the vat. So while most of us pay £300 a thousand, they pay £250.

Which farmers are these then? 
I knew a haulage company owner who would buy his cartridges ( both clay and game ) from a local agricultural supplier which went down on the receipt as ‘detergent’, so what does that prove? 

[oldypigeonpopper]

Hello, I wonder what Sir Dyson will do with his Farming Empire 🤔

[Westley]

20 hours ago, Scully said:

Which farmers are these then? 
I knew a haulage company owner who would buy his cartridges ( both clay and game ) from a local agricultural supplier which went down on the receipt as ‘detergent’, so what does that prove? 

Farmers that I used to shoot with  !

I used to have a Musto account back then too. They would buy all of their Musto shooting clothing, heavily discounted,  then ask me for a VAT receipt to claim back the VAT.

[Scully]

14 minutes ago, Westley said:

Farmers that I used to shoot with  !

I used to have a Musto account back then too. They would buy all of their Musto shooting clothing, heavily discounted,  then ask me for a VAT receipt to claim back the VAT.

I didnt actually quote you, but fair enough. The answer however, is, if they’re vat registered then why shouldn’t they? If I was a vat registered farmer I’d be doing the same, and so would you and ( if they’re honest ) everyone else on this forum. 
Farmers don’t have the monopoly on claiming for items they probably shouldn’t, which is what some people appear to be suggesting, nor are they exploiting some ‘loophole’ regarding the inheritance tax issue, which was government introduced back in the ‘80’s I think. 
I know dozens and dozens of self employed tradesmen and women who avoid paying tax at every opportunity, none of which has anything to do with farmers and inheritance tax.  

The gripes on this forum smack of having more to do with wealth envy than anything else, in my opinion. Folks are seemingly, in the majority on this forum, anti government, until it comes to bashing those who have more than they, then they’re all for it! 
Not surprising, but strangely weird. 🤷‍♂️
 

[Dave-G]

51 minutes ago, Scully said:

I didnt actually quote you, but fair enough. The answer however, is, if they’re vat registered then why shouldn’t they? If I was a vat registered farmer I’d be doing the same, and so would you and ( if they’re honest ) everyone else on this forum. 
Farmers don’t have the monopoly on claiming for items they probably shouldn’t, which is what some people appear to be suggesting, nor are they exploiting some ‘loophole’ regarding the inheritance tax issue, which was government introduced back in the ‘80’s I think. 
I know dozens and dozens of self employed tradesmen and women who avoid paying tax at every opportunity, none of which has anything to do with farmers and inheritance tax.  

The gripes on this forum smack of having more to do with wealth envy than anything else, in my opinion. Folks are seemingly, in the majority on this forum, anti government, until it comes to bashing those who have more than they, then they’re all for it! 
Not surprising, but strangely weird. 🤷‍♂️
 

I can admit to having some of that.

[Westley]

57 minutes ago, Scully said:

I didnt actually quote you, but fair enough. The answer however, is, if they’re vat registered then why shouldn’t they? If I was a vat registered farmer I’d be doing the same, and so would you and ( if they’re honest ) everyone else on this forum. 
Farmers don’t have the monopoly on claiming for items they probably shouldn’t, which is what some people appear to be suggesting, nor are they exploiting some ‘loophole’ regarding the inheritance tax issue, which was government introduced back in the ‘80’s I think. 
I know dozens and dozens of self employed tradesmen and women who avoid paying tax at every opportunity, none of which has anything to do with farmers and inheritance tax.  

The gripes on this forum smack of having more to do with wealth envy than anything else, in my opinion. Folks are seemingly, in the majority on this forum, anti government, until it comes to bashing those who have more than they, then they’re all for it! 
Not surprising, but strangely weird. 🤷‍♂️
 

Most of my farmer friends are tennant farmers anyway, but still go back several generations in the same farm. They all seem to be doing rather well, judging by some of the days shooting they go on. Don't know if they claim the VAT back on that too   ?   😊

[Scully]

57 minutes ago, Dave-G said:

I can admit to having some of that.

I think to a certain extent most people do, myself included, but I know literally dozens of farmers and I wouldn’t swap places with any of them. 
The thing you have to remember about wealth envy, is that if all the money was taken away from those you’re envious about, it wouldn’t make one iota of difference to your life whatsoever, and certainly not your standard of living. 

[amateur]

2 hours ago, Scully said:

I didnt actually quote you, but fair enough. The answer however, is, if they’re vat registered then why shouldn’t they? If I was a vat registered farmer I’d be doing the same, and so would you and ( if they’re honest ) everyone else on this forum. 
Farmers don’t have the monopoly on claiming for items they probably shouldn’t, .....

 

Goods applied to a personal or other non-business use are a taxable supply, the VAT normally being charged on what the goods would have cost at the time they are applied to personal use, exclusive of VAT. Depending on the circumstances, this may or may not be the same as the purchase price.22 Nov 2013

[Scully]

1 hour ago, Westley said:

Most of my farmer friends are tennant farmers anyway, but still go back several generations in the same farm. They all seem to be doing rather well, judging by some of the days shooting they go on. Don't know if they claim the VAT back on that too   ?   😊

Yes, I often wonder how some tennant farmers make enough money to eventually buy their own, and indeed not all do.
I don’t know if they claim it back either! 😀
I only know one tenant farmer and she doesn’t have two pennies to rub together and I honestly wonder why shes doing it.
I used to go ferreting there years ago and it’s a run down ramshackle of buildings ( one of which was condemned and signage to make people aware of that ) on poor Fell bottom sheep pasture. I don’t know how she makes ends meet but she obviously does. 

[Agriv8]

BBC verify

 

Ok this has changed my view , are some farms are be run as tax avoidance schemes by the supper rich ?

Agriv8

[Old farrier]

Just now, Agriv8 said:

BBC verify

 

Ok this has changed my view , are some farms are be run as tax avoidance schemes by the supper rich ?

Agriv8

No mention of land used for forestry is that still exempt 

Or does that still count as farm land 

just curious 

[JohnfromUK]

3 minutes ago, Agriv8 said:

BBC verify

 

Ok this has changed my view , are some farms are be run as tax avoidance schemes by the supper rich ?

Agriv8

So genuine working farmers on family farms that are passed down father to son (daughter) are to be penalised because the Civil Servants are incompetent and cannot produce a law fit for purpose that taxes the 'super rich' tax avoiders, but doesn't tax genuine working farmers?

In the link, it says the average farm makes around 0.5% return per year.  about 45K - out of which they have to live.

But they have to pay 20% tax (over 10 years, so 2% per year.

So every year, they can make around 0.5% - and pay 2% in tax (on the amount by which the value of the farm exceeds £1M), net outgoing of 1.5% per year to be found from exactly where?  Oh, and they also have to live.

5 minutes ago, Old farrier said:

No mention of land used for forestry is that still exempt 

Or does that still count as farm land 

just curious 

I think that counts as farm land, but it is generally lower in value (per acre).  It also only yields income when timber is harvested (many years) although it has some running costs in many years.

[oowee]

5 minutes ago, JohnfromUK said:

So genuine working farmers on family farms that are passed down father to son (daughter) are to be penalised because the Civil Servants are incompetent and cannot produce a law fit for purpose that taxes the 'super rich' tax avoiders, but doesn't tax genuine working farmers?

In the link, it says the average farm makes around 0.5% return per year.  about 45K - out of which they have to live.

But they have to pay 20% tax (over 10 years, so 2% per year.

So every year, they can make around 0.5% - and pay 2% in tax (on the amount by which the value of the farm exceeds £1M), net outgoing of 1.5% per year to be found from exactly where?  Oh, and they also have to live.

I think that counts as farm land, but it is generally lower in value (per acre).  It also only yields income when timber is harvested (many years) although it has some running costs in many years.

I suggest they get a good accountant.

So why should they not have to pay like everyone else?

 

 

[old man]

Quite amusing here?

I don't suppose farmers, rich or poor by whatever definition you decide are any more likely to rip the rear out of the system any more than some others?

While out in the sticks you see lots up and going at 4am, few holidays. No much fun.

Politicians certainly enjoy the black art of obfuscation at every dip in the trough?

[JohnfromUK]

1 hour ago, oowee said:

So why should they not have to pay like everyone else?

No one should ideally have to pay.  Taking money (that has already been taxed when it was earned) from families and pouring it into Gov't coffers where it is spent wastefully and extravagantly is not good for anyone.

Bankrupting family farms isn't good either.