Capital Gains tax rates and allowances and Inheritance Tax rates and allowances were announced which should give farmers and land owners the confidence and more importantly the certainty as to what the tax implications are of them diversifying, passing the estate on or indeed selling the estate.
The confirmation of the reduced rate of VAT (5%) continuing to be applied to those who have diversified into tourism and hospitality and also the confirmation that this will only rise to 12.5% from September 2021 and then returning to full rate of 20% from April 2022, again gives the sector certainty in that area.
The announcement of the super-deduction (130%) for capital allowances on brand new equipment acquired between 1 April 2021 to 31 March 2023, will potentially dovetail into the extended loss relief provisions, allowing companies to carry losses back temporarily for 3 years.
The announcement was that the super-deduction only applied to corporate businesses but, watch this space, as farming interested bodies may lobby for an extension to all businesses. The temporary loss relief provisions, however, apply to all businesses.
All in all, the Budget may have supplied sufficient certainty for farmers to either put into place actions that they have been putting off, or allow them to proceed on already planned for transactions with a degree of certainty about the outcome.