14 February 2017
What could be more romantic than waking up on Valentine's Day to a full English farmhouse breakfast, following a good night’s sleep in a cosy B&B on a farm. Looking forward to romantic walks in the countryside with all that fresh air, Spring flowers starting to appear, early lambs arriving and knowing you are alive and appreciating our treasured countryside. As you wonder through the field, greeted by the pheasants that are scratching around waiting to be rounded up for the breeding season, you look forward to relaxing in the local pub, with a warm beer and a log fire before retiring back to the B&B.
Offering such a great B&B haven has never been easier and should be considered as part of your diversification strategy for your farm and estate. With Airbnb marketing your B&B to the world, it is quick and easy to put your location firmly on the map. You can rent out one room in your house for short or longer lets and claim deductions against income tax for the costs incurred. HMRC have a flat rate scheme to deduct the total cost running the premises, less a flat rate to account for personal use of £350 for one person, and £500 for two people living in the premises.
You may also be able to use HMRC’s rent a room scheme to earn up to £4,250 per year without paying tax. This may not affect your ability to qualify for principal private residents relief. Find out more in their helpsheet here.
Remember that running a B&B or furnished holiday let is a business and so must be declared to HMRC, but there are many tax breaks available to mitigate or eliminate a tax charge on these revenue streams. The Government are supporting this industry as part of their Tourist Policy to encourage more of the UK residents to holiday in the UK.
Remember the bed and breakfast business is a £2 billion cottage industry, and farmers and estate owners have more opportunities than most to have their fair share of this business. From running a B&B in your home, converting redundant farm buildings into furnished holiday lets under permitted development schemes, or providing exciting Yurts, log cabins, and tepees - you can locate guests away from the farmhouse, but still provide easy alternative revenue streams. The advantages of providing self-catering retreats include the ability to have fresh farm food hampers from your farm and the local area available for guests on arrival; upselling to your guests. These guests can easily become regular returning income streams, and can also be loyal customers for any mail-order farm shop deliveries if you are geared up for this.
The opportunity for visiting families to help round up sheep, under strict supervision, will educate them and provide memories and an attachment to the land that will last a lifetime. If you are not already diversifying this way, you have a year to prepare to give those lucky folk a Valentine’s Day they will cherish in 2018.
For further information on any issues raised in this blog, or to discuss your specific circumstances in relation to diversification, please contact Charles Homan, author of this blog, or your nearest rural expert here. Alternatively, to read more on our services to the rural sector please click here, or to read more rural blog posts please click here.
