Small farm tax returns

suited-aces

Hi folks, kind of embarrassing to be asking this question as an accountant, but my field is audit, so please humour me!

I do a few online returns for friends who drive taxis, and have rental properties, but my girlfriend's dad has asked me to do his return (self assessment) for his farm. It's fairly small, 100ish sheep, no crops. However, before I agree, I just want to check, stock valuation aside, is there any unique aspects to doing a farmer's return? I'd hate to say yes then come across something really tricky I wasn't expecting.

jimmo

Speaking as a former Inspector of Taxes, I wouldn’t touch it with a bargepole.

On the very rare occasions that a farming issue landed on my desk I was immediately on the phone to a colleague in a rural office who dealt with farmers on a day to day basis.

If you want a rough idea of what you may be up against, start here and follow the links.

http://www.hmrc.gov.uk/manuals/bimmanual/BIM55000.htm

Itismehonest

I'm absolutely no tax expert but, living in the countryside, my advice would be....... anything involving Defra - leave well alone :wall:

00ec25

jimmo wrote: »

Speaking as a former Inspector of Taxes, I wouldn’t touch it with a bargepole.
http://www.hmrc.gov.uk/manuals/bimmanual/BIM55000.htm[/U][/URL]

speaking as one who last looked at farmers averaging at level 2 ACCA theory, I share Jimmo's viewpoint, if this isn't your daily bread then steer clear

keigcf

I do my husbands contracting tax return, but steer clear of our farm tax returns, you could cost them a lot of money re averaging/ capital allowances/ inheritance tax etc. I wouldn't do it and have worked in Accountancy for 20 years.

Pennywise

I'd echo what others have said. Farms, however simple you may think they are, are a VERY specialist field (excuse the pun!).

I've worked in six different accountancy practices over my accountancy career spanning 29 years. Four of those practices wouldn't touch a farm with a bargepole, despite being relatively large town centre general practices. The biggest practice I worked in (4 offices) had a specialist department that dealt with all clients who even remotely had farming connections.

One practice was a farming specialist practice (large market town surrounded by hundreds of square miles of farmland) - farming was the local economy so they had no choice but to have mostly farming clients. I bluffed my way with a few but was well out of my depth (after 6 years experience in general practice and picking up the ACCA qualification on the way), so I was swifty re-directed to the corporate clients instead of farms. I think the last straw for the partners was when I asked a sheep farm owner how many of their tups were female!

It's not just livestock valuation, though that's a nightmare in itself with getting the values right, dealing with the herd basis, herd basis temporary suspense, etc. It's also the grants - you have to know about the grants - some paid in advance, some in arrears - they have to land in the right accounting period. Then farmers' averaging. Sooo much potential for getting it wrong. As Jimmo said above, HMRC have specialists who'd eat you alive if you get it wrong.

Leave well alone if you aren't experienced. It's not for the faint hearted. People take years to build up experience to make them competent to prepare accounts and tax returns. You won't learn it on the hoof without expert guidance.

jimmo

Pennywise wrote: »

I think the last straw for the partners was when I asked a sheep farm owner how many of their tups were female!

Brilliant!

I’m glad to see I’m not the only one who makes c**k-ups.

suited-aces

Thanks for taking the time to reply folks, dodged a bullet there!

John_Pierpoint

"An old black ram is tupping your white ewe." (Shakespeare's "Othello," 1.1.81-90)