With another tax year over and as we are gradually eased out of lockdown (again!), we can now reflect on what 2021 might hold in store for the farming sector.
Since our last newsletter Brexit has been and gone, the Agricultural Act 2020 is now in place and the coronavirus pandemic continues to have a significant effect on the economy.
This year will see the first, phased reduction of Basic Payment Scheme, which will decrease gradually between now and 2027. At the same time, we are seeing further details emerge ‘ELMS’, the Environmental Land Management Scheme, which will focus on Sustainable Farming Incentives, Local Nature Recovery and Landscape Recovery. Pilots for this scheme are already underway and we expect more details to materialise over the coming months.
Turning to taxes, with the Autumn 2020 budget cancelled, the Spring 2021 budget was eagerly anticipated and there were many whisperings of changes to capital taxes being on the horizon. The Spring budget didn’t make any such changes however, and the thrust of the announcements were aimed at COVID support and changes to corporate tax (further discussion regarding this can be found on in the Super deduction article here). Nevertheless, the Chancellor did leave the door open to changes to Capital Gains Tax and Inheritance Tax in the future. Now may not have been the time for significant tax changes, given the economy is still in a precarious state due to the ongoing pandemic situation, but no doubt tax changes will come at some point to try to make inroads into the national deficit. Read about this further in our article ‘Is the Sun Setting on Succession Tax Relief?’
Whatever 2021 may bring, rest assured that at Dodd & Co we will be working tirelessly to keep our clients up to date with any changes that may impact them.
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