The Budget 2021: What’s changed for the agriculture sector?
The 2021 Budget which was announced yesterday in Government, contained some announcements that may be of limited use to farmers. The “super deduction” tax relief, for example, whereby companies will be able to offset 130% of investment in new plant and equipment from 1 April for two years, sounds great – but it only applies to companies.
In agriculture only 10-15% of businesses are companies, with the vast majority being partnerships or sole traders, which are ineligible for the tax relief.
The business recovery loans, however, available through banks and backed with an 80% Government guarantee (for the bank) for between £25k and £10M, are open to all, and the grants for the self-employed available from February to April at 80% of pre-covid profit (for those whose turnover has fallen by 30% or more) are good news for that sector. If your turnover has fallen less than 30% then grants of 30% are available.
There are no changes to inheritance tax or capital gains tax – IHT is a major consideration for rural landowners, so if you’re considering succession planning then you should be talking to our experts here.
The furlough scheme has been extended, and more information on that and other employment matters affected by the Budget can be seen here.
For those with hospitality sector diversification businesses, then the holiday in business rates has been extended to the end of June, with a discount thereafter, which is good news.
And, finally, whilst the construction industry is going to be hit with a ban on the use of red diesel on site, there is no change for agricultural use.
Get in touch
If you’d like to find out more about this update, please get in touch with Legal Director, Derryn Rolfe.
All information in this update is accurate at the time of writing. It is meant for general information only and is not legal advice.