Further information about the Basic Payment Scheme Lump Sum Exit Scheme (the golden handshake or retirement lump sum) has now been released.


The Rural Payments Agency have confirmed that they expect that farmers will be able to apply for the lump sum from April 2022. Please note that this scheme is only for Basic Payment Scheme applicants in England.


We have outlined some of the main points to 
consider:

  • The value of the payment will be calculated based on your entitlement in the claims for 2019, 2020 and 2021.

  • The lump sum is capped at the lower of 2.35 times the average of these claims and£99,875.
  • 
Overclaims will be factored into the calculations. However, the taper reduction for 2021, cross compliance penalties, and greening penalties will be ignored.

  • To be eligible for the payment you must transfer your agricultural land in England (apart from up to 5 hectares which you can keep) or plant with trees under a woodland creation scheme or transfer the grazing and pannage right you have on common land in England, or surrender your English BPS entitlements.
  • A partnership can claim the lump sum if a partner/partners entitled to 50% of profit (combined) leave the partnership, and a company can claim the lump sum if a shareholder/shareholders holding 50% of shares leave/s the company. However, the company or partnership must surrender all its entitlements and will then be unable to claim BPS or delinked payments.

  • Any BPS claim made for 2022 will be deducted from the retirement payment.

  • You must transfer out the agricultural land and provide evidence of this by 31 May 2024. You can apply for an extension to this date if you have an Agricultural Holdings Act 1986 tenancy with succession rights and the succession goes to a tribunal, arbitrator or court.

The first step is to request a forecast statement, which can be done through the Government website. The scheme will close on 30 September 2022.


Once the lump sum payment is made, you will no longer be eligible for BPS payments or delinking payments in England.


If you feel this is something which you would like to explore, please contact your land agent for further information

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