[News] Farmers

[ManOfSussex]

Mooo!

 

[Bozza]

You seem to suggest that all pensioners are going to freeze!

Not at all, no. Many pensioners who received the Winter Fuel Allowance didn't need it to stay warm through the colder months, but plenty did.

I see Liz Kendall wrote to Debbie Abrahams, the Labour chair of the Work and Pensions Select Committee today, detailing the large number of pensioners that will be pushed into poverty directly by this policy alone.

It remains utterly shameful.

 

[WATFORD zero]

You might be surprised at the number of hobby farmers / smallholders there are, as well as other small-scale rural businesses classified as farms and officially a commercial operation. The reality is that they are little more than a hobby or (in modern parlance) a side-hustle. Someone with room for an extra horse might set up a livery business for example, but it's not really a commercial operation in the full sense (might allow a few things to be run through the books as business expenses, mind...)

I'm sure there's a lot, but it's like claiming the average farm in the UK is 200 acres, It's just a single figure (lies, damn lies and statistics)

But the vast majority of the farms are well under that and the simple fact is that the vast majority won't pay IHT even under the new rules. Farmers still have a far better deal (£3M tax free for a couple, 20% IHT over that and 10 years to pay it), than the average person leaving a business or anything else to their children (£1M tax free, 40% IHT and immediate payment).

As a result of the last budget, 40% of my pension 'pot' will go in IHT immediately when I die, but I'm not whining about it, there are people who are seriously struggling and, as a country, we are desperate for investment. (I may be coming up with new ways of lessening my 'pot' but don't tell the kids ).

As someone pointed out above, is targeting those with £4- £10M to pay a bit more, really that dreadful

 

[nicko31]

Not sure if there have been any comments on this but why can't the farmers 'gift' the farm to their children and, providing they don't die within 7 years, it won't be subject to IHT? Also, take out life insurance for the next 7 years to cover IHT if you die within that period!

What’s interesting is it can be tapered, ie if someone died after 5 years there would be 5/7th exemption.

Very few people are going to be caught. More faux outrage from the right wing

 

[WATFORD zero]

 

[drew]

Not at all, no. Many pensioners who received the Winter Fuel Allowance didn't need it to stay warm through the colder months, but plenty did.

I see Liz Kendall wrote to Debbie Abrahams, the Labour chair of the Work and Pensions Select Committee today, detailing the large number of pensioners that will be pushed into poverty directly by this policy alone.

It remains utterly shameful.

I don't think the policy is shameful but the bar was set too low.

 

[drew]

something i've pondered, i suppose there's mistrust of family (though then why so bothered!) or they die with little warning without making plans. likewise making a holding company must have some disadvantage or it's an obvious better setup, especially with all the plant involved.
train of thought has a flip side, why anyone would be buying land just for the IHT loophole when they could be using the 7 year rule. or trusts.

I'm guessing they do it because they retain control of the asset right up until their death.

 

[Bozza]

I don't think the policy is shameful but the bar was set too low.

It remains utterly shameful that the government is knowingly forcing large numbers of pensioners into poverty.

 

[drew]

Until this sudden announcement which no one knew about there was literally no need, it's that simple.

Not sure that's a good argument. I have no sympathy for the likes of Dyson, Lloyd Webber and Clarkson. As for family farms, we are led to believe all the fearmongering is about not being able to pass it down and keep it in the family. Well know, they can, just 7 years before they die!!!

 

[dazzer6666]

Not sure that's a good argument. I have no sympathy for the likes of Dyson, Lloyd Webber and Clarkson. As for family farms, we are led to believe all the fearmongering is about not being able to pass it down and keep it in the family. Well know, they can, just 7 years before they die!!!

Not quite as simple as that otherwise everyone would be do it - would be treated as a gift with reservation unless they paid market rent (which would be taxable income)

 

[dazzer6666]

Double quids in as the Oak Barn owners are the current owners / to be sellers of the Par 3 course..!

No exact timeline on when it will close, told to me by one of their Pro’s..

Owner already sold it, then leased it back. Building is due to start in about 10 years.

 

[Me Atome]

I'm sure there's a lot, but it's like claiming the average farm in the UK is 200 acres, It's just a single figure (lies, damn lies and statistics)

But the vast majority of the farms are well under that and the simple fact is that the vast majority won't pay IHT even under the new rules. Farmers still have a far better deal (£3M tax free for a couple, 20% IHT over that and 10 years to pay it), than the average person leaving a business or anything else to their children (£1M tax free, 40% IHT and immediate payment).

As a result of the last budget, 40% of my pension 'pot' will go in IHT immediately when I die, but I'm not whining about it, there are people who are seriously struggling and, as a country, we are desperate for investment. (I may be coming up with new ways of lessening my 'pot' but don't tell the kids ).

As someone pointed out above, is targeting those with £4- £10M to pay a bit more, really that dreadful

Yes, but the farm is not a "pension pot" built up over the farmer's working life, like yours or mine. The farmers never earn enough to build up a pension. So the effect of IHT will be to reduce the means for their successors to earn, whether they sell off part of the farm or pay it off over years. That is the generality, of course there are loads of variations.

 

[cunning fergus]

Not sure that's a good argument. I have no sympathy for the likes of Dyson, Lloyd Webber and Clarkson. As for family farms, we are led to believe all the fearmongering is about not being able to pass it down and keep it in the family. Well know, they can, just 7 years before they die!!!

All that I agree with, and of course the very rich landowners will be unaffected, just as the very same rich landowners took the cream of the CAP when we were in the EU.

https://search.app/DBgq5Kfn2yWWAo9r6

On that basis this policy is punching down, if the Labour Party were serious about taxing the wealthy this ain’t the policy to do it………although I’m sure it will scratch an itch for their more zealous supporters.

 

[Bodian]

Yes, but the farm is not a "pension pot" built up over the farmer's working life, like yours or mine. The farmers never earn enough to build up a pension.

Not always, no. But they are quite often allowed to build a bungalow on the farm for an agricultural dwelling for the child or parent (interchangeable) - which they then 'retire' into. (Although they rarely actually retire!) It's virtually impossible for most of us to simply build our own home to retire into for free, after living mortgage free in the main home.

 

[Not Andy Naylor]

Everybody wants better public services but they want someone else to pay for them.

 

[dsr-burnley]

something i've pondered, i suppose there's mistrust of family (though then why so bothered!) or they die with little warning without making plans. likewise making a holding company must have some disadvantage or it's an obvious better setup, especially with all the plant involved.
train of thought has a flip side, why anyone would be buying land just for the IHT loophole when they could be using the 7 year rule. or trusts.

The obvious disadvantage of setting up a company is that it doesn't save any IHT. If you own a limited company that is worth £6m it gets taxed just as much as if you own a farm worth £6m.

Also, if give the farm to your child then you can't keep working on it or taking profits from it. If you do, it's a gift with reservation and the 7 year period does not start. There's every chance it wouldn't start until Mr. Farmer has moved off the farm.

Trusts are complicated and expensive.

 

[Bozza]

Everybody wants better public services but they want someone else to pay for them.

Nah.

I'd much rather pay a little bit more NI or tax myself, instead of poverty-stricken pensioners being hit hard.

 

[dsr-burnley]

I'm sure there's a lot, but it's like claiming the average farm in the UK is 200 acres, It's just a single figure (lies, damn lies and statistics)

But the vast majority of the farms are well under that and the simple fact is that the vast majority won't pay IHT even under the new rules. Farmers still have a far better deal (£3M tax free for a couple, 20% IHT over that and 10 years to pay it), than the average person leaving a business or anything else to their children (£1M tax free, 40% IHT and immediate payment).

As a result of the last budget, 40% of my pension 'pot' will go in IHT immediately when I die, but I'm not whining about it, there are people who are seriously struggling and, as a country, we are desperate for investment. (I may be coming up with new ways of lessening my 'pot' but don't tell the kids ).

As someone pointed out above, is targeting those with £4- £10M to pay a bit more, really that dreadful

It's quite a lot more. If you have land plus farmhouse plus barns plus tractors and combine worth £6m, and profit is a good rate of 2% on capital, that would leave the inheriting farmer with an annual profit of £120,000 per year, out of which he would have to pay income tax of £50,000, inheritance tax of £100,000, and use what isn't left to live on. Obviously it can't be done. He will have to sell part or all of the land.

And who will buy it? Certainly not another family farmer. Perhaps a foreigner who doesn't pay IHT, but perhaps someone who will build on it, or cover it with solar panels, or perhaps one of these massive farming companies that is also exempt from IHT. So the question becomes, is it worth the £500m or so income to make that sort of change to the countryside? And to our food supply?

 

[Super Steve Earle]

It's quite a lot more. If you have land plus farmhouse plus barns plus tractors and combine worth £6m, and profit is a good rate of 2% on capital, that would leave the inheriting farmer with an annual profit of £120,000 per year, out of which he would have to pay income tax of £50,000, inheritance tax of £100,000, and use what isn't left to live on. Obviously it can't be done. He will have to sell part or all of the land.

And who will buy it? Certainly not another family farmer. Perhaps a foreigner who doesn't pay IHT, but perhaps someone who will build on it, or cover it with solar panels, or perhaps one of these massive farming companies that is also exempt from IHT. So the question becomes, is it worth the £500m or so income to make that sort of change to the countryside? And to our food supply?

And the answer is no.

 

[chip]

It's quite a lot more. If you have land plus farmhouse plus barns plus tractors and combine worth £6m, and profit is a good rate of 2% on capital, that would leave the inheriting farmer with an annual profit of £120,000 per year, out of which he would have to pay income tax of £50,000, inheritance tax of £100,000, and use what isn't left to live on. Obviously it can't be done. He will have to sell part or all of the land.

And who will buy it? Certainly not another family farmer. Perhaps a foreigner who doesn't pay IHT, but perhaps someone who will build on it, or cover it with solar panels, or perhaps one of these massive farming companies that is also exempt from IHT. So the question becomes, is it worth the £500m or so income to make that sort of change to the countryside? And to our food supply?

No.

This and the WFA aren't really about the money they may make, nor are they about addressing some abhorent inequality. The appologists keep trotting out they will only affect a small number of people, an extra100000 people into poverty is no big deal to them. I like the assumption that there will be a husband and wife to use their allowances seperately to inflate the figures while claiming it will only affect 500 farms (not people) each year, sounds familiar and wrong. There just doesn't seem to be anything joined up in this governments thinking.