Land Management Today

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Land Management TODAY – LMT – is published for the first time today.  The first edition is the work of a group of postgraduate students at Harper Adams University who came together at the end of June to study a module called Land Use and Management.  The first edition contains 28 short articles covering a range of topics.  Download your copy of LMT here: Land Management Today July 2017.

Here is the full contents list:

  1. How farming is set to lose its flavour
  2. Buying into Ecosystem Services – whetting the appetite for diversification
  3. Battery storage, the next big thing for energy production?
  4. Branding: Rural Estates in the head and on the ground
  5. Bringing Back Britain’s Trees
  6. Avoiding Failure with Forwards and Futures .
  7. Smother With Cover: black-grass .
  8. A Tale of Two Leys
  9. Will Dairy Cows Ever See a Human?
  10. Conventional v Organic: Breaking Down Barriers
  11. Diversity & Inclusion; The £24 billion boost
  12. Farm smart in the hills
  13. The Drones are Coming
  14. Finding your perfect partner: Relationships not Rules for land tenure success
  15. State Open for Business
  16. Tax simplification; anything but simple
  17. Spring Budget Basics for Taxation on Rural Estates
  18. Brexit for Breakfast
  19. Agricultural Trade: “Preparing for the Worst, Hoping for the Best”
  20. Soil Health Subsidies
  21. Countryside Stewardship Scheme
  22. Telecommunications-The Implications for Rural Land Owners
  23. Telecoms and the Rise of Statutory Powers
  24. Compulsory Purchase: RICS mandates practice with new PS
  25. Make sure you don’t lose out with Business Rates
  26. No Growth in the Greenbelt
  27. Mid-Tier Countryside Stewardship and Capital Grants – are you missing a trick?
  28. H-App-y Maps
  29. Contributor Profiles

This is the first in what we hope will continue as a series of occasional papers on current topics of concern to land management today.

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Budget 2016: Rural and property points

Headline points from the 2016 Budget for the rural economy and property. Get out of sugar, get into tunnelling, run a micro-business on the side, infrastructure needs you, take your capital gains now, incorporation is looking better and better unless you intend to sell your professional services to the public sector, drink whisky and beer not wine. Despite this, old age and death are beginning to look expensive.

A £3.5 bn reduction in public expenditure is not intended to dent George Osborne’s claim that, “We [ie the Conservative Government] are the builders”. Practically this means Continue reading “Budget 2016: Rural and property points”

80% of tied cottage occupiers could face tax on empty bedrooms

Thank you to everybody who responded to my survey on tied housing.  I have now offered the following observations in response to the HMRC consultation’s suggestion that the tax and National Insurance treatment of tied housing as a benefit in kind should be based on its full rental value.

The suggestion that all employer provided accommodation should be taxed on the basis of its full market rental value could therefore have significant implications for [rural] occupiers, many of whom are likely to be at the lower end of the pay range.  This in turn is likely to lead to greater pay pressures on employers at a time when there is no sign of agricultural volatility decreasing and when those same employers are facing the additional costs of extended pension rights etc.
It is also worth highlighting the contrast with Local Housing Allowance (LHA) and Housing Benefit (HB) if the proposal to move to full rental value were to go ahead.  LHA and HB are both restricted according to the number of bedrooms the occupier is deemed to need and LHA is further restricted to the lower level of rent prevailing in the district.  80% of the respondents to my survey would find their entitlement restricted if they were LHA or HB claimants, yet would almost certainly find it impossible to move to alternative accommodation without changing their job.

The online survey was undertaken between Monday 4 January and Tuesday 2 February 2016 using SurveyMonkey. No attempt was made to define a particular population beyond occupiers of employer provided living accommodation generally, with attention drawn to the survey via social media (twitter, LinkedIn, charlescowap.wordpress.com) and direct approaches to contacts in the rural economy. I cannot claim that the survey is representative of a particular group, nor that the results should therefore be treated as compelling. It does however provide a persuasive insight into the housing arrangements for people employed in some sectors of the rural economy.

Key findings:

  • Number of respondents: 25, all of whom live in accommodation provided by employers
  • Twenty pay no rent for their accommodation (80%), while five pay some rent (20%). Nobody claimed to pay full market rent.
  • Size of accommodation ranged from one to six or more bedrooms, Table 1

Table One: Number of bedrooms

Number of bedrooms Number of dwellings
1 2
2 4
3 5
4 8
5 4
6 or more 2
Total 25

 

  • The twenty five dwellings were occupied by a total of 70 people, ranging from single occupiers to couples with one or more children.
  • One respondent worked in education. Most respondents (n=17) worked on rural estates and seven occupiers worked in agriculture. There were no respondents from the forestry, licensed trade, security, other estate or property management or finance and banking sectors.
  • Two respondents paid Income Tax or National Insurance on the value of their accommodation but the majority did not (n=19, 76%). One respondent did not wish to answer this question and a further three did not know.

The data were further analysed as to the suitability of the accommodation for the size of the family unit living there. This was done by reference to the qualifying bedroom criteria for Local Housing Allowance and Housing Benefit.

  • Of the 25 households, twenty would have had their entitlement to benefit restricted due to an excessive number of bedrooms. This would have affected 58 of the 70 people covered by the survey. Examples of those excluded included:
  • 10 out of 11 couples in the survey occupying property of two or more bedrooms;
  • Two couples with children over 16 occupying houses with more than four bedrooms;
  • Two couples with one child under 16 occupying houses with more than three bedrooms.

One respondent who had lived in employer provided accommodation offered the following observations in response to the survey:

“Having lived in service accommodation for many years I’d comment:

1 In accepting a position where I was required to live in service accommodation to meet my contractual obligations I had no choice in the location (edge of pig farm)type of housing, nearby education, or standard of maintenance and external environment

2 There is an implicit and unpaid expectation that there will be a significant and unpaid additional labour contribution – unlocking for out of hours lorries and loading/unloading, telephone, attending sick animals

3 Additional taxation of such housing as a benefit could break that relationship and would require an employer to pay more for out of hours service

4 We never thought of service accommodation as a benefit, but a liability, knowing that when job terminated we would have to move so saved and invested every penny to buy a flat first, then a house, for long term security” (Mr John Stones, former director Nuffield Farming Scholarships)

Implications

Questions 9 and 10 of the HMRC Consultation, Employer Provided Living Accommodation, Call for Evidence (January 2016) ask what proportion of employees provided with accommodation pay rent, how much rent do they pay, how is the value paid as rent calculated before going on to suggest that a move to market rental value would provide a simplification to the tax system.

The findings of this survey suggest that very few occupiers in the rural economy pay any rent at all, and that a move to full market rental value could have disproportionate effects on occupiers who have little or no choice over the size of the accommodation provided for them. A move to market rental value as the basis of taxable benefit is likely to lead to upward pressure on pay in order to compensate for the extra cost, and with this consequences for employer costs including increased National Insurance contributions.

 

 

Introducing ‘Blight’ – Planning Blight and Compulsory Purchase

I have made four presentations on the topic of planning blight and compulsory purchase.  These are primarily for the land management students at Harper Adams University, but they may be of interest to a wider audience.  The first video describes statutory blight, and deals with the types of owner and property which qualify for blight protection under the Planning Acts.  The second video deals with the procedures for the successful service of a blight notice up to and including a reference to the Upper Tribunal (Lands Chamber).  Video Three addresses the specific and special requirements for blight notices on farmland and the final video in the series reviews discretionary blight, while also picking up some of the advance purchase and compensation schemes which have been initiated by HS2.

Happy Viewing!

Who wants what this time?

Systemic Solutions at the landscape-water interface was the title of a workshop held at Bristol Aquarium on Monday 10 February 2014, and I was asked to speak about the landowner’s perspective.

Who want what this time? was my opening question.  When dealing with anything in relation to rural land it’s vital to realise that you are rarely starting with a blank sheet.  Are you dealing with the Somerset Levels or the Cambridge Fens, Exmoor or the Peak District, or something in between?  Some of the items that may already be listed on that far-from-blank sheet include: Continue reading “Who wants what this time?”

Autumn Statement 2013

Good news if you want to employ a youngster, go to university, rent a shop or use a lot of fuel.

The Autumn Statement predicts increased growth, up to 1.4% from 0.6% for 2013, and the total in employment by 2018 of 31.2 million.  In other words, about half the population.

Fuel duty is to be frozen for the rest of this Parliament.  Employers will not have to pay employer National Insurance on under-21 year olds, unless they are being paid more than £813 a week (in other words higher rate taxpayers).

Business Rate rises will be limited to no more than 2% irrespective of higher inflation in 2014/15, and retail property will benefit from a rate discount of up to £1,000 in 2014/15 and 2015/16.  This will apply to properties with a rateable value of less than £50,000.  In addition new occupiers of shops which have been empty for at least 18 months will get a 50% discount on their rates bill.  Small Business Rate Relief will be doubled from April 2015.

Local authorities will be encouraged to sell high value vacant social housing in order to reinvest in new housing, and their revenue account borrowing limits will be raised in order to encourage social housing investment.

The Personal Allowance for Income Tax increases to £10,000 next April and a new form of Married Couples Allowance makes its debut.  It applies to civil partners as well, but don’t get too excited.  The transferable tax allowance of £1,000 arrives in 2015/16 and is NOT available where either party is a higher rate taxpayer.  So who does this help?  Couples where perhaps one partner isn’t able to use their own tax allowance in full and the other partner is an ordinary rate taxpayer.  So the resulting benefit is likely to be no more than £200 a year.

If your overseas clients are thinking of selling UK residential property they had better act now, as CGT is to be introduced on non-residents’ disposal of UK residential property.

Energy

Fracking – onshore oil and gas exploration – will receive a new tax allowance with immediate effect.  Details are thin at this stage however.

A new fund to help private landlords to improve the energy efficiency of let property is to be introduced.

Grants of up to £1,000 will be available to make substantial energy investments in property newly purchased over the next three years.

Infrastructure

The National Infrastructure Plan gets a makeover, but don’t get too excited.  Buried in the small print of the UK Insurance Growth Action Plan is the expectation that 70% of planned expenditure is expected to come from the private sector (meanwhile Defra sees cuts to its budget of £19 million next year and £18 million the year after).  Setting aside this small reservation, the list of projects includes:

  • New nuclear power at Wylfa in North Wales;
  • Railway station improvements at Gatwick Airport;
  • Improvements to the A50 at Uttoxeter by 2015/16;
  • The A14 improvements near Cambridge will not include a new toll road;
  • A new £10 million competition for ‘hard to reach’ broadband will launch in 2014, which may therefore be helpful to the less accessible rural areas;
  • Topical on the day that an Autumn Statement is accompanied by the threat of the worst floods on the East Coast since 1953, we are promised a list of key flood defence projects by the time of next year’s Autumn Statement;
  • There is also to be a £10 million prize pot for the first town or city to set up a pilot driverless car project.

A new Infrastructure Court is also promised – so look for some interesting relationships with the work of the Planning Inspectorate’s Major Infrastructure Unit (formerly the Infrastructure Planning Commission!).   So will this be IPC2?

The UK Insurance Growth Action Plan includes a chapter which introduces the investment of £25 billion by six insurance companies in infrastructure over the next five years.  They will be looking for commercially and economically viable economic and social infrastructure projects, most probably in transport, housing, energy, health and education.  This can include major projects led by private sector sponsors.  Projects already undertaken include campus developments, student accommodation, Alder Hey Children’s hospital.  And look out for a new logo to be displayed on infrastructure emerging from this initiative!  It’s a shame however, that this makes no mention of ‘green’ infrastructure – surely an attractive opportunity for the insurance industry where the reduction of flooding risk is on offer?