Farming - kerfuffle

[Solomotree]

interesting how Jeremy Clarkson, one of the biggest vocal opponents of the inheritance tax on farms, literally boasted that he bought the farm to avoid paying it. It’s people like this we need to clamp down on and where people’s ire should be directed. And the vast vast majority of farms will not be affected.

www.theguardian.com/uk-news/2024/nov/01/farmers-shocked-budget-inheritance-tax-estates

While I don’t condone the comment about living in a static caravan, one of the reasons it’s difficult to attract people into farming is because farms get passed down the generations & just aren’t available to new entrants

I’m and fifth generation farmer married to a sixth generation farmer. We farm 70 acres of beef, sheep and cider. It was last valued 5 years ago at £1.2m so we already know we over the threshold for IHT. When we die the tax bill will be so great that our children will probably not be able to afford to pay it (unless they win the lottery!) After nearly 200 years and six generations the farm would be sold and once that happens for a farming family, there will be no going back. The landscape of Britain will change forever. Food biosecurity will disappear (imports have shameful standards - think chlorinated chicken and sow stalls) and prices will increase. It will be very hard to pay off IHT against overheads to run a farm. The bigger farms are major suppliers to supermarkets (think 20p cheap veg at Christmas) so expect food to get very volatile in price going forward.

Farming families like us look to the future. Our children's future. And their children's future.
Everything we do is to try and protect the farm for future generations. A parent is nothing more than the custodian of the land during their lifetime, passing it to their children to do the same once the come of age. And so the cycle continues.

Generational family farms are rarely wealthy businesses. Farming is a very long apprenticeship with deep learned experience required, being passed down through the generations. It’s not a job, it’s a way of life where our existence is entangled in the farm 24 hours of the day, 365 days of the year. It’s our place of work and our home. It's in our bones, our blood and for some all they know how to do. We work endless hours for little financial reward because we are investing in our children's futures. It’s completely different than other businesses which is why APR exists in the first place.

Neither my husband or I, our siblings, or farming neighbours went to private school. Just the village primary then local comp.

Farming is completely different now than it was in 1992. My husbands parents supported a family of 5 on a modest dairy herd. My own grandfather paid £25,000 death duties in 1977 driving him to alcohol with the worry of having to find the money. The human cost of government policy is real.

I listened to Political Currency this morning - Ed Balls & George Osborne. Osborne said he looked at closing up the loophole of rich folk buying up farmland to dodge IHT several times during his tenure and said they were repeatedly told (I’m guessing by Treasury) that it was nigh on impossible to do so without hitting genuine family farms.

Transcript from podcast below:

George: “You are right. That was what I was going to pick up as well in terms of things I noticed. Just small things in passing, first of all, I reckon this issue of inheritance tax on family farms, where the limit is a million pounds before you pay inheritance tax, I think this is going to be one of those things which may become a growing issue in the coming weeks and months.

One of those things where you just wonder, has the Treasury really thought through all the hard cases? It's quite easy to have a low-income, hard-working farming family, which have had their farm for generations, where if you actually add up the 100 acres of land and the house, it's more than a million pounds. If the dad dies, have they got to sell the farm to pay the inheritance tax?

Ed: I'm watching that. The other thing which I thought was...

George: I mean, you're just on that. That's where I've had a lot of people get in touch with me.

Ed: Already?

George: Yes, and people saying it doesn't just impact, of course, the landowners, but tenant farmers. They maybe have a tenancy and then the farm has to be sold by the owners of the land. And even if you look at the treasury numbers, they say 75% of farms won't be affected.

Well, hold on, that means 25% will be. And I know what they're trying to do. You know, some very, very wealthy billionaires have bought up a lot of farmland.

And there was an inheritance tax loophole in effect for them, which is they can pass that land on without paying inheritance tax. I looked at this in budget after budget, because I wanted to deal with that loophole. And I couldn't find a way around the family farm problem.

It's the million pound number. To Rachel Reeves and her team, they'll have thought million pounds sounds like a big number. I wonder whether actually, when you really dig into the cases, million pounds is a big number or a small number for cash poor, asset rich farmers.

And we've been here before, where the Treasury, in the long list of budget measures, something's in there. You think, surely that's OK, million pounds. And it turns out to be much more complicated.

And 100 labour seats now are rural, by the way.”

I’m and fifth generation farmer married to a sixth generation farmer. We farm 70 acres of beef, sheep and cider. It was last valued 5 years ago at £1.2m so we already know we over the threshold for IHT. When we die the tax bill will be so great that our children will probably not be able to afford to pay it (unless they win the lottery!) After nearly 200 years and six generations the farm would be sold and once that happens for a farming family, there will be no going back

and this is exactly how farming becomes a viable option for new entrants rather than an ‘old boys club’ passed down with impunity

Not particularly, no! But more upset thinking my kids may well not get the option to decide if they'd like to farm or not...

You have summed it up beautifully.

There have been a few threads on this today on MN. one poster wrote ‘well my local farmer has 2 new pick up trucks and I drive a 2008 car’. The reply was ‘so you rely on your 2008 car to haul a trailer full of sheep over fields?’ Quite.

These people feed us. This new rule will affect every single person in the U.K. who eats food. Every one of us. Anyone who thinks they won’t be affected is delusional.

We should want our farms to do well. I want my local farmer thriving and profitable and able to buy a new tractor or rent a newer combine. I don’t want them to sell off a few acres for housing. I want them to farm our food.

This policy is another race to the bottom.

Just increase income.tax for everyone.
Simplest and easiest way to.raise the funds for decent services.
Don't.pick on one group.
Let everyone contribute.

Do people ever think about where their food comes from? Is it just British farmers they want to damage? Loads of countries give preferential treatment to farmers when it comes to tax (for obvious reasons). I guess we will just be buying even more food from those countries now and that will be more money leaving the country and more food miles. We can build on our farmland and become even more dependant on other countries to feed us.

Thankfully I’ve inherited my wee farm and Rachel Reeves won’t get her hands on any of my family’s money. She’s as common as muck in my opinion

looking at your posting history it’s a mix of thinly veiled xenophobia, left hating and over stated patriotism. Maybe no-one wants you to farm ‘our land’ any more.

@FarmersWife2019 what a thoughtful and beautiful post. I hope your family can find a way through.

To those saying well it’s ok, a new entrant will pop up and buy it. To fund buying a farm and then the working capital is not going to be your average Bob who has a level 2 in Ag from the local college. It will be big big money. And they certainly won’t give two hoots where the 1940’s drains were put in, how often you really should hedge and ditch or looking after the soil with some cracking manure. it’ll be continuos wheat with maize thrown in where possible and the less productive stuff put out to stewardship.

Easiest way to pick out the people buying Ag land for IHt relief is to have an active farmer test. Calve a cow, shut a 16000 hen shed at 11pm on a Sunday night, combine a field or reverse a tractor into a shed and you’ll spot the real farmers pretty quick.

The other huge opportunity they have completely let slide is that rollover is still ok. how the hell is that still being allowed. Any real farmer would have been fine with them abolishing rollover relief on anything above say 10% of the average sold.

Tee hee

The IHT is entirely voluntary. Farmers can farm as a limited company and transfer shares to family members, or take out insurance or do their utmost to transfer the farm 7 years before they die with insurance as a back up there too. These are all things that owners be of other assets do to protect themselves.

and this is exactly how farming becomes a viable option for new entrants rather than an ‘old boys club’ passed down with impunity

Are you suggesting that farmers having to sell up will make space for those from a non-farming background to have a go?

For a start who will teach them? Yes there are agricultural colleges but the real learning is done on a farm doing the work with the farmers, who know what needs to be done, spot problems with animals or crops before it gets out of hand (and if you’ve ever worked with animals you know how difficult that can be). Generations of farmers grow up learning this stuff, and there are opportunities for those without a farming background, but it relies on there being experienced farmers to bring them on.

Next point - if the farms are sold up none of these young people wanting to be farmers will be able to afford to buy the land, the machinery they need, the animals and the means to maintain them. The farms being sold will end up in the hands of more Jeremy Clarksons and James Dysons. It’s incredibly naïve to think it will open up opportunities for young people, and quite naïve to think that there would be enough of them to fill the farms - farming is incredibly difficult, long hours, few breaks, it’s not a 9-5 job; get your work done then switch off, save for a holiday, time off on Christmas Day, weekends off, nights are for uninterrupted sleep, regular reliable hours. Farming is non stop, 24/7/12/365. Plenty go to work on farms and cannot hack it - 20 hour days in calving and lambing time, silage time, slurry spreading, harvesting - grain then potatoes then carrots, then ploughing, milking if you’re dairy. It’s non stop. It needs some specialised and very expensive equipment. It’s not a case of budging up so others can have a go.

Some people are very ignorant of what losing food security would look like. It’s not something you can just magic back once it’s gone.

Or it gets bought by a huge commercial farm group, losing all the of the personal blood, sweat and tears that six generations of one family have poured into it. It's pie in the sky thinking that "new entrants" on any kind of useful scale want to get into farming. These kind of family farms will just get lost forever to big commercial agriculture at best, and to land developers at worst.

This isn’t a case of new entrants versus ‘old boys club’ as you so charmingly put it. Please
do not diminish my history by presenting the governments decision to reduce APR as a way of new entrants coming into farming.
There will
be no pressure for my children to go into farming but I would like them to have the opportunity if they so wish to. Instead of squeezing out generational family farms the government should be encouraging new entrants rather selling off council farms. We should be championing generational family farms and new entrants.
You seem to have missed my point about farming being a very long apprenticeship. It’s decades of learned lived experience being passed down through the generations. It’s not something you learn from a book or Google. My pre school child is already learning and loving it.

I’m very worried about food quality and security going forward. I also wonder how the country side will look in 30 years without family farmers stewarding the land.

I have real sympathy for family farms, but I am even more worried about the long term effects of this on us all.

I'm guessing that you're not a farmer OP! No one, apart from Clarkson, buys a farm to avoid paying tax. He never wanted a farm, but a restaurant/shop/tourist trap, which he could do on the back of his celebrity. Normal everyday folk are unable to make a business thus way. The vast majority of farms are handed down through generations. They barely make a profit. Farmers are barely making the minimum wage, if that from farming, hence why the planning regs support farm diversification which is often used to prop up a farm. Farmers are not rolling in it. They get up at the crack of dawn at 4am and finish around 8pmish on a normal day (unless lambing, calving, hay making etc which requires all nighters). Farming is a way of life. Very few would choose it as a career. It has an exceptionally high incidence of suicides.
If a farmer has to sell off land to pay the inheritance tax, then he is splitting up the business and risks it becoming unprofitable. Then the farm is worth considerably less as its valuation comes from the combination of the farm buildings, land and output. And who would buy it? The govt have said that the vast majority of farms will not be affected. They have said only 2000 a year. Of course, that's because not all farmers are so elderly that they are going to imminently die. But 2000 farms is a lot! That's 8,000 farms over the govts term in office. How many farms do you think remain in the country? It is also the loss of a generational home and business.
In a period of climate change, high food prices and food insecurity, it's very short sighted to go after farmers. But then labour has never been aligned with farmers in this country.

Still, if an opinion piece written in The Guardian, from behind a desk, says that it's not a problem, it can't be right? Because it doesn't have a political bias at all, right?

losing all the of the personal blood, sweat and tears that six generations of one family have poured into it.

but families lose businesses all the time because they’re not financially viable. Why does farming necessitate an exception?

Pass it to your children now and thentry to live a healthy 7 years.
Between yourself and your partner.
Or think of transferring it to a limited company.
There are ways around this.

@Solomotree

I fucking despair.

Because that's how we get to eat stuff

Got fed up with his bellendery years ago.

In the dictionary under to ‘pratt, n’ is : Jeremy Clarkson, noun often accompanied by a descriptive adjective (eg, fucking, entitled, supercilious, bloviated etc).

Not sure if I can share a link but if anyone is concerned about this please do sign the NFU petition. Even if you aren't involved in farming - this matters because of the huge impact it will have on our food security, our landscape and our rural communities.

Government should raise income tax for everyone not target one group like this.
We need massive income and income tax is the easiest and fairest way to raise it.
One group should not be burdened.
We all want good services we all should.pay.
Simples.

The 'old boys club' has to be the most ridiculous comment ever!! All those old men, holding onto riches and power and handing out farms to friends and family for favours! You do realise that the wives and daughters work just as bloody hard don't you? You do realise that people aren't standing in the wings, just desperately wanting to acquire a farm as an excellent business opportunity! You do realise that crops go to waste in this country since foreign workers left because there is no one that actually wants to work a cold shitty job with long hours for a pittance? My uncles and cousins are all farmers. Trying to recruit staff and apprentices is a nightmare. They've not had a holiday in years. I think that if people actually witnessed what farming entailed, their views might substantially change.