Abi’s take on the Autumn Budget
Sun 10 Nov 2024
Many will now be aware of the changes in inheritance taxation and the increased cost of farm labour planned to be implemented. As the industry continues to learn more about what these reforms to agricultural businesses look like, below are some of the other changes implemented which may also impact your farm business cash flow and should be planned for where possible. Please take advice early as the budget confirms the following :-
· £5 billion over two years to support the transition towards a more productive and environmentally sustainable agricultural sector in England. This includes £60 million this year for the Farming Recovery Fund and over £400 million of support towards tree planting.
· Farming Recovery Fund will support farmers that were affected by Storm Henk. The RPA will contact eligible farmers.
· Countryside Stewardship higher tier will be open with a rolling application window. This scheme will provide funding for more complex, long-term projects.
· BPS will be drastically reduced next year to be capped at £8,000 per farm. This alteration will have greatest impact on the larger farms. This will be planned as a 76% reduction to the first £30,000 of a payment, with no payments for any proportion of a payment above £30,000. 100% planned reduction after that. SFI income will be crucial to help bridge the gap in cash flow for the following years.
No matter what your previous delinked payments were, no more that £8,000 will be received next year and that will be the final payment through those funding streams.
· As of January 2027, Carbon Border Adjustment Mechanism (CBAM) will cover high-emission imports which would include fertilizers. This will align with the government climate goals but potentially mean higher prices for artificial inputs used on farm, so it makes sense to try and find ways of limiting use of expensive fertilizer where possible, starting now. I can advise you on this.
· The government confirms it will extend the existing scope of Agricultural Property Relief from 6 April 2025 to land managed under an environmental agreements, which isn’t the case at the moment. The team can advise you on this.
As part of the team at Masons Rural I feel I am well placed to advise you on maximizing the government schemes to access the money available and find a sustainable future for your business.
If you are interested to explore how SFI or other agri-environmental schemes can support your cashflow please get in contact with me on 01507 350512 or Lucy Turner on 01507 350522. We are here to help.