Updates from across the Bruton Knowles Rural Services Team
Welcome to this special update from the Bruton Knowles Rural Services Team.
In this edition, we discuss the latest ongoings across the team, including reaction to the Autumn Budget, and what it means for some of our clients, as well as other significant issues from across the Team.
Reaction to the Autumn Budget from a Rural perspective
Finally after months of speculation, the Chancellor Rachel Reeves delivered the new Government’s first Budget on 30th October 2024.
As expected, rural property was hit, with the first serious changes to Inheritance Tax Agricultural Property Relief (APR) and Business Property Relief in a generation.
Here's what you need to know:
From April 2026, the first £1m of qualifying combined business and agricultural assets will continue to attract no inheritance tax at all, but for assets over £1m, inheritance tax will apply with 50% relief, at an effective rate of 20%.
This is the first reduction in APR since APR was increased to 100% in the early 1990s. Obviously, this comprises a damaging rise in IHT tax bills, £1m is likely to cover only the smallest of farms, meaning that practically all farmers can now expect to be subject to IHT on their deaths.
However, those affected should not panic. We at Bruton Knowles have a dedicated team of rural tax experts who can help. John Amos , Charlotte Ibbs and Geoff Coster have many years of experience in this field and will be watching closely as detail of the initial proposals develop.
From our initial analysis, it is clear the value placed on agricultural land, and farm buildings, which previously attracted 100% relief will now be far more closely scrutinised by HMRC. The value of these assets has risen sharply in recent years, thus the importance of their valuation by an experienced realistic professional will be key.
Owners of farmland and other rural property will understandably be very concerned about this new blow to the future viability of their farms and businesses, but help is at hand.
For advice on the likely consequences for your position after April 2026 please contact us at our Leominster office for an initial discussion on your options - call 01568 610007.
Changes to Farmers Funding and how our expert team can assist
This year has seen the introduction of delinked payments, which replaced the Basic Payment Scheme (BPS) subsidy. The requirement to actively farm was completely removed and payments based on a reference amount will taper down to zero by 2027.
The Autumn Budget revealed that payments due in 2025 will be drastically cut. The first payment band up to £30,000 is to be reduced by 76% and all the higher payment bands reduced to zero. The maximum payment available therefore, will be £7,200 resulting in a significant loss of income.
Farmers looking to replace the shortfall in BPS should now be reviewing the funding options that are currently available to them, including the Sustainable Farming Incentive (SFI) and Capital Grants schemes.
A well-planned SFI application could have the potential to offset lost BPS income, without any major changes to the applicant's current farming setup. Additional SFI actions are set to be released in the future to add further value.
Capital Grants are available to work alongside chosen SFI actions such as for fencing and hedgerow works. To help improve animal health and welfare, farmers who keep cattle, sheep or pigs can get funding for a vet to visit their farm to carry out annual reviews.
At various times of the year, the RPA release schemes for funding to invest in equipment, technology and infrastructure to help increase productivity.
For more information on how we can assist, contact Adam Holt, our Agricultural Adviser on 07510 372473 or email Adam.holt@brutonknowles.co.uk.
Could a Contract Farming Arrangement be your next move?
Bruton Knowles have a long and well-respected history of providing Contract Farming Agreements (CFA) and tenancy advice, support and management whilst working on behalf of landlords and tenants.
Recently, we have seen an increase in the number of CFA requests with many landowners opting to enter a CFA over a Farm Business Tenancy (FBT) especially where longer terms are being offered.
We are perfectly positioned to offer a full service and help our landowners to manage their farming business and are delighted to advise clients on the differences between CFAs and FBTs and how which option may be suitable for your business situation.
The market for land to contract farm and rent remains strong and we have offered several entire farms, pasture, and arable blocks to the market. We have been delighted with record demand for all land types with top values having been achieved for productive arable land with longer term lengths or where ground is offered for premium crops.
If you have any CFA or tenancy questions, queries or would like us to help with your negotiations, please do get in contact with Hannah Morgan MRICS FAAV on 07514 493039 or email hannah.morgan@brutonknowles.co.uk.
Rural Facebook page launches
We are delighted to announce the launch of a brand-new Rural-specific Facebook page!
The Rural team has been publishing various properties and land it is overseeing the sale and letting of - to check out the page and like to ensure you don't miss a future update, click here.
Come and join the team at Bruton Knowles.
For details of our latest vacancies please take a look at our Careers Page. We're always keen to hear from those who are passionate about what they do and ambitious in outlook.