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Farming

Farmers should prepare for IHT changes

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FARMERS should review their Inheritance Tax (IHT) and succession plans ahead of the Spring Statement as potentially significant changes are expected, according to rural accountant Old Mill.
There are less than six months before the Spring Statement, and changes to the IHT format – based on recommendations originally outlined by the Office of Tax Simplification (OTS) in July 2019 – are likely. “The recommendations were primarily geared towards streamlining IHT administration but may have the secondary effect of reducing some of the favourable reliefs available to farmers,” explains Catherine Vickery, associate director at Old Mill.
“Current IHT legislation can be very beneficial for farmers, giving confidence that they can pass down agricultural business and property assets to the next generation tax free on death,” she adds. “Unfortunately, the coronavirus pandemic has left the Government with a very large debt, so there’s potential that it will implement any OTS recommendations to increase tax revenue.”
So, with the Spring Statement anticipated for March, what can farmers do to mitigate any potential changes?
“Under the existing rules, agricultural land and property qualify for Agricultural Property Relief (APR) from IHT at up to 100%,” explains Mrs Vickery. Other land and property assets, like diversified enterprises, can qualify for up to 100% Business Property Relief (BPR) as part of an overall farming business which is at least 50% trading. “These reliefs can apply on lifetime transfers as well as on death where the conditions are met.”
Transfers on death currently also qualify for Capital Gains Tax (CGT) free uplift so that gains are effectively washed out. Lifetime transfers of agricultural land, property, and businesses which are at least 80% trading qualify for gift holdover relief, meaning gains can be deferred until a later disposal.
However, a key OTS recommendation is to remove the CGT free uplift on death when IHT relief is also available. This would mean that the next generation would inherit the farm at an historically low base cost, leading to higher CGT on any future sale.
The OTS has also just released its report into CGT simplification which echoes this same recommendation.   Proposals to alter the trading test for BPR, aligning it to the 80% CGT trading test could leave farmers ineligible for 100% BPR, which could result in assets having to be sold to pay IHT liabilities.
“The most tax efficient option has often been for farmers to continue to actively farm and hold onto assets until they die,” says Mrs Vickery. “Now, given speculation about potential changes, the best course of action is to get a succession plan in place as soon as possible and start implementing it.
“Plans need to be arranged based on what is right for you, your family and the farm right now, rather than how things might stand at a later date.”
This means establishing who is taking on the assets and if they have the skills needed to drive the business forward. “Pass over this responsibility while you still can and while you can be on hand to guide and support your successor,” advises Mrs Vickery.
It’s also important to review partnership or shareholder agreements, and consider the handing on of other assets. Additionally, farmers should collate any trust and gift deeds, so that paperwork is on hand to be reviewed.
“Though we suspect the new IHT rules won’t be favourable, farmers need to make use of the rules we have now as these are a current certainty,” says Mrs Vickery. “Succession planning is so easy to put off but it’s a vital tool in safeguarding the future of farming businesses.”

Crime

Warning of heavy fines for farms as six Romanians found working at dairy farm

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ILLEGAL WORKERS DISCOVERED IN MID WALES RAID

A DAIRY FARM in Llangedwyn, Powys, faces heavy fines after immigration officers arrested six Romanian workers found working illegally during a dawn raid on January 28. The business owners could now be fined up to £60,000 per worker and face a possible prison sentence if found guilty of failing to carry out proper employment checks.

The arrests come as part of a major crackdown on illegal working across Wales and the West of England. Home Office Immigration Enforcement teams carried out 121 visits last month, resulting in 101 arrests—more than double the number recorded in January 2024.

Tougher action against illegal working

Officials say enforcement activity has reached record levels, with 609 arrests made nationwide in January—an increase of 73 per cent compared to the same period last year.

Eddy Montgomery, Director of Enforcement, Compliance & Crime, said:

“Despite many premises in the region being in rural locations, these numbers show there is no hiding place from the law. We will come after any business that thinks it can exploit illegal workers for its own gain.”

Since last summer, both illegal working visits and arrests have risen by 38 per cent, with the Home Office issuing 1,090 civil penalty notices to businesses hiring illegal workers.

New law to target people smugglers

The Border Security, Asylum and Immigration Bill, set to be debated in Parliament today, will give law enforcement new powers to target people-smuggling gangs and disrupt illegal migration. The legislation will allow officers to search electronic devices for evidence of organised crime.

Home Secretary Yvette Cooper said: “For far too long, employers have been able to take on and exploit illegal migrants with little to no enforcement. Not only does this create a dangerous draw for people to risk their lives crossing the Channel in small boats, but it results in the abuse of vulnerable people and undermines our economy.

“That’s why we are boosting enforcement to record levels alongside tough new legislation to crack down on the criminal gangs that profit from illegal migration.”

Record removals of illegal migrants

Alongside the crackdown on illegal working, the Home Office says it is stepping up deportations of those with no legal right to remain in the UK. Since the election, 16,400 people have been removed, including criminals convicted of drug offences, theft, rape, and murder.

Bespoke charter flights have returned over 800 immigration offenders to their countries of origin, marking the highest removals since 2018.

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Farming

Pembrokeshire Farmer Mansel Raymond Elected Chair of CARAS Cymru

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PEMBROKESHIRE farmer Mansel Raymond MBE FRAgS has been elected as the new Chair of CARAS Cymru, the prestigious Council for Awards of Royal Agricultural Societies, following his unanimous election by the CARAS Cymru Council in January.

He will serve a two-year term, succeeding Janet Phillips FRAgS, who stepped down after a distinguished tenure as Chair.

CARAS is a highly regarded awarding body that recognises individual who have made exceptional contributions to agricultural and rural progress across the UK. With national panels representing each of the four UK nations, CARAS Cymru plays a key role in celebrating and honouring the achievements of individuals in Welsh agriculture.

Mansel Raymond, a well-respected figure in the agricultural community, leads a family partnership in Pembrokeshire alongside his brother, their wives, and sons.

Over the years, he has held numerous high-level positions across the agricultural industry, including President of Copa Cogeca Milk Board, past Director of First Milk, European Milk Chairman, and Chairman of the NFU’s Milk Board. He has also served as Pembrokeshire County Chairman for NFU Cymru and as past President of the Pembrokeshire Agricultural Society.

In response to his election, Mansel said, “It is a huge honour to take on the role of Chair of CARAS Cymru. I’m deeply proud to be involved with an organisation that recognises the remarkable individuals who shape our agricultural industry.”

He added, “I also want to extend my gratitude to Janet Phillips for her exemplary leadership during her tenure as Chair. Her contributions have been invaluable, and I hope to build upon the strong foundation she leaves behind.”

Mansel will be joined by Malcolm Thomas MBE FRAgS, who has been elected as the new Vice Chairman of CARAS Cymru. Malcolm, from Llangynog in Carmarthenshire, brings a wealth of experience, having had a long and distinguished career in agriculture. He is a former Director of NFU Cymru and has served as a trustee of various charities and organisations throughout his career.

Both Mansel and Malcolm are committed to furthering CARAS Cymru’s ambition to recognise and honour outstanding achievements within agriculture, rural life, and the wider rural economy

Malcolm Thomas MBE FRAgS Vice-Chair CARAS Cymru
Malcolm Thomas MBE FRAgS Vice-Chair CARAS Cymru
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Farming

Cold milk feeding maintains growth rates and offers flexibility for surplus lamb rearing

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A RCENT survey of over 100 sheep producers has highlighted that 58% of respondents will consider feeding milk replacer cold to surplus lambs this season and view the method as a viable alternative to feeding warm milk during the busy lambing period.

In a separate question, over half of respondents said that feeding milk replacer cold to lambs has no difference to lamb growth rates and can be advantageous for feeding lambs at different growth stages. The data comes from the annual Lamlac Lamb Intentions Survey carried out at the end of 2024.

Dr Jessica Cooke from Lamlac says ewe milk replacer fed cold is a proven technique and provides surplus lambs with the consistent rearing support they require.

She says: “Rearing surplus lambs with milk replacer fed cold offers sheep producers a time-effective feeding method in their systems. After following recommended rearing practices during the first week of life, the ability to feed cold can also be useful in situations when rearing lambs of different ages requires milk to be fed at a constant temperature.”

This response from sheep farmers is supported by trial work from Reaseheath College where comparisons between cold and warm milk feeding were evaluated on surplus lambs. Dr Cooke highlights how the cold milk fed lambs performed in the trial.

“Lambs fed cold milk replacer from just over a week of age showed no negative impact on their performance. In fact, lambs fed cold milk replacer performed marginally better through to weaning – achieving a daily live weight gain of 0.27kg/day, compared with the 0.25kg/day delivered by the warm milk fed group of lambs.

“This data highlights that feeding milk replacer cold isn’t a poor alternative to warm milk feeding and can add flexibility to lambing systems. With over half of producers stating it has no difference to growth rates, flockmasters should consider it as a viable feeding option, especially if warming milk isn’t possible or time limitations prevent it,” says Dr Cooke.

General rearing advice for producers administering milk cold to surplus lambs shouldn’t be any different to feeding warm milk replacer.

“A single lamb reared away from the ewe to weaning (at an average of 35 days of age) will require a minimum of 9.5kg of Lamlac (equating to 47.5 litres of reconstituted ewe milk replacer). It is worth remembering that lambs should have access to fresh water, straw, and a good quality creep feed to encourage rumen development. Producers feeding cold milk replacer should always mix cold and feed, rather than mixing warm and allowing to cool, as this could encourage lambs to gorge,” concludes Dr Cooke.

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