Why are Farmers Complaining

kinger101

artyboy said:

Given that farms are a business, and often quite a large one, is there a reason why their assets are not typically owned through limited companies (or another suitable legal entity structure) that the farmer and any relevant spouse/offspring could be directors of?

I admit I'm no expert in this field, but it seems to be the fact that the land etc is directly owned by the farmer as a personal asset that's what will cause IHT liability...

Shares in a limited company are subject to IHT.

kinger101

Another bad idea from Reeves.  I don't see the problem with IHT on landowners who don't farm, but levying IHT on farmers who own their land makes little sense to me. I'd have put in a rollover relief where it is only taxed if the recipients don't continue to farm the land for say five years.  Yes, the farmer gets an exemption  I do not but I wouldn't want to own or manage a farm in a million years.  For most, it's damn hard work for little reward.

This raises very little money, but potentially damages our food security.  In the meantime, those letting land to tenant farmers still get a vehicle to partially avoid IHT.

Grumpy_chap

I assume this thread will be closed as it is getting political.

Am I the only one to wonder whether farmers were somewhat disingenuous today?

I admit I know little about the matter - until a week ago I was unaware that farms were exempt from IHT.  Whether it is correct or not, the Government seem to have taken the line that the exemption to IHT is inappropriate because rich people are buying farms solely to avoid IHT.

The farmers put forward as their spokesperson Jeremy Clarkson.

He would seem to be the very epitome of playing into the Government's narrative...

Hoenir

Grumpy_chap said:

He would seem to be the very epitome of playing into the Government's narrative...

Jeremy Clarkson operates the farm as a business. 

Grumpy_chap

Hoenir said:

Grumpy_chap said:

He would seem to be the very epitome of playing into the Government's narrative...

Jeremy Clarkson operates the farm as a business. 

More mature, rich gentleman buys farm.
Are you saying he was unaware of the IHT exemption?  If so, no loss to him if IHT now applies.
Having bought the farm, might as well make it work as hard as possible to generate income - even do some TV stuff about it.

BikingBud

movilogo said:

The way house price is going up, nearly everyone within 100 miles of London will end up paying IHT in near future.

One might opine that was part of the plan all along!

movilogo

until a week ago I was unaware that farms were exempt from IHT

This! Majority was simply unaware of this rule. Now whole country knows farmers want to bend the rules in their favour. They are still getting special treatment though 20% IHT compared to 40% for others.

Fluffysheep7

Obviously many emotional arguments. However sticking to inheritance tax. No sensible genuine farmer needs to pay it using PETs except unlucky few dying April 2027 to November 2031. So succession is tax free. Sky news yesterday skipped over the avoidance mechanisms. It seems likely, unlike IHT on pensios, the tax changes on farms will raise very little..... until the other shoe drops! It's a tough career choice but conflating that with a totally avoidable inheritance tax is disingenuous.

Andy_L

artyboy said:

Given that farms are a business, and often quite a large one, is there a reason why their assets are not typically owned through limited companies (or another suitable legal entity structure) that the farmer and any relevant spouse/offspring could be directors of?

I admit I'm no expert in this field, but it seems to be the fact that the land etc is directly owned by the farmer as a personal asset that's what will cause IHT liability...

The farmer would still be the owner of the Ltd company so it would still be an asset in the estate.

FIREDreamer

Andy_L said:

artyboy said:

Given that farms are a business, and often quite a large one, is there a reason why their assets are not typically owned through limited companies (or another suitable legal entity structure) that the farmer and any relevant spouse/offspring could be directors of?

I admit I'm no expert in this field, but it seems to be the fact that the land etc is directly owned by the farmer as a personal asset that's what will cause IHT liability...

The farmer would still be the owner of the Ltd company so it would still be an asset in the estate.

Sell the shares to his successor for £1.