Farm Business Expansion in Challenging           Economic Times  Simpkins Edwards – Mary Jane Campbell    Lloyds TSB Agric...
Making way for the next     generation   Mary Jane Campbell
Including the Young FarmerThree scenarios- Within the existing business- Expansion/ improvement of operations- Starting a ...
Existing BusinessThe existing business- Typically start as an employee- Comes a time to join parents businessAdvantages- S...
Existing BusinessDisadvantages- Responsibilities on YF- Same income to spread further- Loss of capital if YF leaves partne...
Existing BusinessRates and Allowances Personal Allowance    8105 (under 65)                       10500 (65-74)          ...
Existing Business Considerations for new partners- Off farm income- Tenancy succession-Have a partnership agreement
Existing BusinessPartnership agreement    sets out basic parameters    profit and capital shares    holidays and workin...
Existing BusinessOther tax considerationsIHT - Agricultural Property ReliefCGT – Entrepreneurs reliefAdditional housing re...
ExpansionExpansion Areas of expertise Which activities show best return? Assess limiting factors Improving efficiency
Expansion Pop up economics – Tim Harford
ExpansionThink out side the box – nominate a MattParkerIf you do what you have always done don’tbe surprised when you get ...
Expansion More profit   Outputs - Yield/quality/price   Costs – price/quantity   Calving interval, drilling date, cell...
ExpansionExtra resources- Land via FBT or purchase- Marginal cost means attractive rent may   be tendered, or inflated pri...
New Enterprise Business planning, financing etc. Trading structure     - Sole trader or partnership     - LLP or company...
New EnterpriseExample Renewables project - whose money will fund the project? - what is income profile for investors and  ...
New EnterpriseTypical succession issues-   Control / insecurity-   Other family members-   Housing of families-   Tax (ren...
New enterpriseFinal thoughts –To retire or not…………     Liability to care home fees     may help APR on farmhouse     ne...
New EnterpriseWills- clarify position for family- estate simpler and cheaper to administer- review every 10 years or so- d...
Mary Jane Campbell Partner, Simpkins Edwards LLP          01392 211233mjcampbell@simpkinsedwards.co.uk   www.simpkinsedwar...
Farm Business Expansion inChallenging Economic Times                                         David Fowler                 ...
Certainties in life
Banking Issues• World Economy• Eurozone Crisis• Effect on UK Banking System• Borrowing consequences for farmers
Debt crisis – the underlying problems• Greece – heading for default?• Italy – highest total debt in eurozone, corrupt, not...
Debt crisis – the effectsThe Financial Markets• Stability of banks – capital ratios increased• Write offs & Credit Default...
Bank Funding Costs lead to higher margins                                        9.00                                     ...
UK Base Rate – 300 yr low…                                                            UK Base Rate since Jan 1975     18  ...
Drivers affecting farming - 1. GBP/EUR                   1.3                                      GBP/EUR                 ...
Driver 2 - UK CP Inflation                   6   %                                                              UK CPI YOY...
Driver 3 - Crude Oil                  120                                                                                 ...
Driver 4 – Wheat                 300                                                 Generic European Union Wheat Futures ...
What does a good proposition look like?•3   years up to date accounts• Management information for the current year• Budget...
What funding products are available?• Overdraft• Loan – variable rate over base• Loan – fixed rate over the cost of funds•...
Discounted loans currently available1. Funding for Lending  • 1% discount for the whole term  • Variable & fixed rate loan...
How we help farm businesses                                    Modern and efficient banking                               ...
What does a good agricultural bank do?• Understand the Industry• Understand the market place• Understand the enterprise   ...
“The best thing about owning a farm …                        …......is the tax breaks                        …..the most i...
DisclaimerThis presentation does not constitute or imply an offer or commitment whatsoever on the part of Lloyds TSB Bank ...
David Fowler – Regional Agricultural Manager                   Thank You
Planning for the Future    Amanda Burden   B.Sc (Hons), FAAV, MBIAC
Proud to be Agricultural• Luscombe Maye celebrating 140th Year  1873-2013• 6 Offices• 9 Rural Professionals• Covering Devo...
Why a Planning Application ?•   Expansion of Farm Business•   Diversification of Farm Business•   Capitalise on Assets•   ...
National Planning Policy Framework • At its heart, presumption in favour of   sustainable development    – Economic role –...
Planning Policy Statement 7  (PPS 7) Annex A – now defunct• Permanent Dwellings  – Outline Application -    • Agree “Princ...
Specific Requirements• Functional Need• Financial Test• No other dwellings suitable and  available close by (incl. “afford...
Conditions• Agricultural Tie on new dwelling and  existing dwelling ?• Limit on size of dwelling  – “Commensurate” with es...
Associated Problems• Already too many dwellings on farm ?  – Split holding/business  – Offer long-term FBT to son/daughter...
Temporary Dwellings• Demonstrate intentions to develop enterprise  eg. Farmbuildings• Show business can be viable eg. Busi...
Timing• Permission for temporary dwellings  normally 3 years  – Meet Financial test for permanent dwelling  – Extensions n...
Temporary Permission• PPS 7 says temporary permissions should  not be given on sites where LPAs  would not allow a permane...
Plan Ahead• Seek advice from Professional/Agent not just  from Planning Authority• Seek advice from you Accountant, Solici...
Remember !!• Planning History on Sites - Hope Value ?  – Withdrawals        - Approvals  – Refusals           - Appeals• C...
“The bad news is you’ll need a conditional use permit for the flight operations, a    health permit for the brewing facili...
Planning for the Future    Amanda Burden    B.Sc (Hons), FAAV, MBIAC
Single Payment Scheme    and Rural GrantsClaire Hoyte BSc (Hons) MRICS FAAV
Single Payment Update• EU has added 9  new countries  since 2005• New budget needs  to incorporate  these countries• Singl...
Future of SPS• Uncertain as limited info from Brussels at  present• EU commission carrying out review of CAP• Basic propos...
What this means…• Entitlements still have a value for next  two years• Flat rate value depends on Euro rate• Don’t change ...
Things to note for the 2013           year…• 1st March – SPS Claim forms released• 2nd April – Transfer deadline• 15th May...
And for new farmers…..•   New Entrants Scheme•   This is a possibility for Young Farmers•   Will be mandatory for all memb...
Grants•   Catchment Sensitive Farming•   Across UK – target areas•   Whole of South Devon•   £10,000 based on 50% cost•   ...
Catchment Sensitive           FarmingOpen 1st March to   30th April
Other schemes…•   Entry Level Stewardship•   £30 per ha•   Uplands Entry Level Stewardship•   £62 per ha•   Organic Entry ...
Proud to be Agricultural•   Luscombe Maye celebrating 140th Year•      1873-2013•   6 Offices•   9 Rural Professionals•   ...
ANY QUESTIONS?
Please complete a feedbackform and stay for a chat and      enjoy some light       refreshments.
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Farm Business Expansion in Challenging Economic Times - 26 Feb 2013

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Simpkins Edwards ran a seminar for farmers and agricultural business owners with Lloyds TSB Agriculture and Luscombe Maye on 26th February 2013 entitled 'Farm Business Expansion in Challenging Economic Times'.

The presentation, given by Partner Mary Jane Campbell, Simpkins Edwards and David Fowller, Lloyds TBS Agriculture along with Amanda Burden and Claire Hoyte, Luscombe Maye gave a practical guide to dealing with changing or expanding your business.

Are you looking to expand an enterprise? Maybe specialise in your most profitable area? Are your children looking to join you in the business? If so, you are going to need some financial, tax and practical support and advice...... and this could give you the information you need.

Making way for the next generation - What are the tax implications?

Business Finance - How to secure borrowing to support your farm business now and in the coming months.

Occupying land as a farmer - what are your options?

Planning points - for agricultural dwellings, farm buildings etc

Common Agricultural Policy Reform - what is the future for SFP?

For further information please either call or e-mail Sharon on 01392 211233, sroberts@simpkinsedwards.co.uk.



Simpkins Edwards can also provide speakers to host seminars on a variety of accounting, financial, tax and business issues.
To book a speaker please e-mail sroberts@simpkinsedwards.co.uk or call 01392 211 233.

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Farm Business Expansion in Challenging Economic Times - 26 Feb 2013

  1. 1. Farm Business Expansion in Challenging Economic Times Simpkins Edwards – Mary Jane Campbell Lloyds TSB Agriculture – David Fowler Luscombe Maye – Stuart Hext, Amanda Burden, Claire Hoyte
  2. 2. Making way for the next generation Mary Jane Campbell
  3. 3. Including the Young FarmerThree scenarios- Within the existing business- Expansion/ improvement of operations- Starting a new enterprise
  4. 4. Existing BusinessThe existing business- Typically start as an employee- Comes a time to join parents businessAdvantages- Saves employment taxes- YF more motivated- Reduces tax burden
  5. 5. Existing BusinessDisadvantages- Responsibilities on YF- Same income to spread further- Loss of capital if YF leaves partnership
  6. 6. Existing BusinessRates and Allowances Personal Allowance 8105 (under 65) 10500 (65-74) 10660 (75 plus) NI Class 4 threshold 7605 ( up to 65) Married Couples Allowance for over 75s Age Allowance for over 65s £25,400
  7. 7. Existing Business Considerations for new partners- Off farm income- Tenancy succession-Have a partnership agreement
  8. 8. Existing BusinessPartnership agreement sets out basic parameters profit and capital shares holidays and working time actions if a partner wants to leave, incapacitated or dies agreement for use of land owned by a partner
  9. 9. Existing BusinessOther tax considerationsIHT - Agricultural Property ReliefCGT – Entrepreneurs reliefAdditional housing requirements- local housing- sharing farmhouse- planning for agric tied dwelling
  10. 10. ExpansionExpansion Areas of expertise Which activities show best return? Assess limiting factors Improving efficiency
  11. 11. Expansion Pop up economics – Tim Harford
  12. 12. ExpansionThink out side the box – nominate a MattParkerIf you do what you have always done don’tbe surprised when you get the result youalways get!Use benchmarking dataHave a plan with actions and targetsCheck progress against plan in words andnumbers
  13. 13. Expansion More profit  Outputs - Yield/quality/price  Costs – price/quantity  Calving interval, drilling date, cell count, LWG by feed or days  System – more drastic
  14. 14. ExpansionExtra resources- Land via FBT or purchase- Marginal cost means attractive rent may be tendered, or inflated price offered- Financing again marginal cost important- Cashflow criticalBut - ensure there are plans to monitor performance so it does not slip with growth
  15. 15. New Enterprise Business planning, financing etc. Trading structure - Sole trader or partnership - LLP or company Tax structure to suit - investors - workers/managers
  16. 16. New EnterpriseExample Renewables project - whose money will fund the project? - what is income profile for investors and managers?- what is impact on existing business?
  17. 17. New EnterpriseTypical succession issues- Control / insecurity- Other family members- Housing of families- Tax (rental/investment asset)
  18. 18. New enterpriseFinal thoughts –To retire or not…………  Liability to care home fees  may help APR on farmhouse  need the income?If you only do one thingMake a will!
  19. 19. New EnterpriseWills- clarify position for family- estate simpler and cheaper to administer- review every 10 years or so- discuss with familyGood Luck
  20. 20. Mary Jane Campbell Partner, Simpkins Edwards LLP 01392 211233mjcampbell@simpkinsedwards.co.uk www.simpkinsedwards.co.uk
  21. 21. Farm Business Expansion inChallenging Economic Times David Fowler Regional Agricultural Manager Devon 01392 424871 07802 655897
  22. 22. Certainties in life
  23. 23. Banking Issues• World Economy• Eurozone Crisis• Effect on UK Banking System• Borrowing consequences for farmers
  24. 24. Debt crisis – the underlying problems• Greece – heading for default?• Italy – highest total debt in eurozone, corrupt, not tackling the issues• Spain – property boom/bust, 26% unemployment - 6m• France – huge sovereign/private exposure to Greek debt• Germany – most of their neighbours are broke• Ireland – UK has heavy exposure to Irish debt - £9Bn
  25. 25. Debt crisis – the effectsThe Financial Markets• Stability of banks – capital ratios increased• Write offs & Credit Default Insurance costs• Quality of lending book? – good debts/bad debts• Availability of capital – QE, ECB funding• Mis-selling – PPI & Derivatives / SWOPSThe Customers• NO change – servicing ability, track record, full proposals budgets / cash flows, gearing, securityBorrowing Terms• Higher margins, due diligence, FSA Regulation
  26. 26. Bank Funding Costs lead to higher margins 9.00 8.00 UK Bank CDS spread UK banks’ 5-yr term funding cost (%) 7.00 3mth Libor spread UK Bank Rate 6.00 5.00 4.00 3.00 2.00 1.00 0.00 2005 2006 2007 2008 2009 2010 2011 Source: Bloomberg/LBCM
  27. 27. UK Base Rate – 300 yr low… UK Base Rate since Jan 1975 18 16 14 12 Base Rate 35yr Ave 10 30yr Ave 25yr Ave 35 Yr Ave = 8.05% 20yr Ave 8 15yr Ave 10yr Ave 30 Yr Ave = 7.25% 5yr Ave 6 25 Yr Ave =6.46% 4 20 Yr Ave = 5.11% 15 Yr Ave = 4.43% 10Yr Ave = 3.47% 2 5 Yr Ave = 2.82% 0 5 7 9 1 3 5 7 9 1 3 5 7 9 1 3 5 7 9 1 7 7 7 8 8 8 8 8 9 9 9 9 9 0 0 0 0 0 1 n- n- n- n- n- n- n- n- n- n- n- n- n- n- n- n- n- n- n-Ja Ja Ja Ja Ja Ja Ja Ja Ja Ja Ja Ja Ja Ja Ja Ja Ja Ja Ja
  28. 28. Drivers affecting farming - 1. GBP/EUR 1.3 GBP/EUR 1.28 1.26 1.24 1.22 1.2 1.18 1.16 1.14 1.12 1.1 Jan-12 Apr-12 Jul-12 Oct-12 Jan-13Source: Bloomberg, Lloyds Bank
  29. 29. Driver 2 - UK CP Inflation 6 % UK CPI YOY 5 4 3 2 1 0 Dec-10 Mar-11 Jun-11 Sep-11 Dec-11 Mar-12 Jun-12 Sep-12 Dec-12Source: Bloomberg, Lloyds Bank
  30. 30. Driver 3 - Crude Oil 120 Crude Oil ($) 110 100 90 80 70 60 Jan-11 Apr-11 Jul-11 Oct-11 Jan-12 Apr-12 Jul-12 Oct-12 Jan-13Source: Bloomberg, Lloyds Bank
  31. 31. Driver 4 – Wheat 300 Generic European Union Wheat Futures (EUR/metric tonne) 250 200 150 100 Jan-11 Apr-11 Jul-11 Oct-11 Jan-12 Apr-12 Jul-12 Oct-12Source: Bloomberg, Lloyds Bank
  32. 32. What does a good proposition look like?•3 years up to date accounts• Management information for the current year• Budgets and cash flows – stress tested• Business Plan• Planning permission• Tenders / quotes• Capital budgets• Consultancy advice
  33. 33. What funding products are available?• Overdraft• Loan – variable rate over base• Loan – fixed rate over the cost of funds• Commercial Finance – HP & Leasing• Invoice discounting and factoring• How do we assess the margin? Secured and unsecured• Matrix rates based on customer risk profile – how can thisbe improved?
  34. 34. Discounted loans currently available1. Funding for Lending • 1% discount for the whole term • Variable & fixed rate loans2. National Loan Guarantee Scheme (now finished) • 1% discount for 1st 5 years of fixed loan over £250k • Limited funds - £30m taken up in 1st 5 weeks 2013!
  35. 35. How we help farm businesses Modern and efficient banking facilities delivered with a focus on great customer service Flexible options including fixed, variable, interest-only loansSingle Farm Payment (SFP) hedging Machinery and equipment financeInterest risk management Investment in infrastructureBusiness income protection
  36. 36. What does a good agricultural bank do?• Understand the Industry• Understand the market place• Understand the enterprise •The farmer •The farm business• Help Facilitate Change• Help Manage Risk• Deliver this knowledge locally
  37. 37. “The best thing about owning a farm … …......is the tax breaks …..the most important of which is ………… ……..Inheritance Tax” Money Week 22.1.2010
  38. 38. DisclaimerThis presentation does not constitute or imply an offer or commitment whatsoever on the part of Lloyds TSB Bank plc (“Lloyds TSB”). Any such offer may only be made after the negotiation of satisfactory documentation and only after appropriate credit authority has been obtained. The pricingdiscussed herein is based on our view of current market conditions and is for discussion purposes only.This presentation and all ancillary documents relating to it (together the "Presentation") was prepared by Lloyds TSB exclusively for you for the purpose of analysing certain potential transactions. The Presentation is being made available on a strictly confidential basis to you and is intended only for theinternal use of authorised recipients (“Recipients”) and no part of it may be disclosed to any third party. This Presentation and the information contained herein are the property of Lloyds TSB. Recipients are hereby notified that photocopying, scanning, or any other form of reproduction, or distribution- in whole or in part - to any other person at any time is strictly prohibited without the prior written consent of Lloyds TSB.The information in this Presentation reflects prevailing conditions and our judgment as of this date, all of which are subject to change or amendment without notice and the delivery of such amended information at any time does not imply that the information (whether amended or not) contained in thisPresentation is correct as of any time subsequent to its date. Whilst Lloyds TSB have exercised reasonable care in preparing this presentation and any views or information expressed or presented are based on sources they believe to be accurate and reliable, neither Lloyds TSB, nor any of theirofficers, servants, agents, employees or advisors make any representation or warranty, express or implied, as to the fairness, accuracy, adequacy, completeness or correctness of such information, nor as to the achievement or reasonableness of any projections, targets, estimates, or forecasts andnothing in this Presentation should be relied upon as a promise or representation as to the future. Neither Lloyds TSB nor any of their officers, servants, agents, employees or advisors or any affiliate or any person connected with them accepts any liability whatsoever for any direct, indirect orconsequential damages or losses arising from any use of this Presentation or its contents or otherwise arising in connection therewith. Lloyds TSB undertakes no obligation to update or correct any information contained herein or otherwise to advise as to any future changes to it. Applicabletax, accounting and legal considerations are subject to change and in all cases independent professional advice should be sought in those areas.This Presentation is provided for information purposes only: there has been no independent verification of the contents of this Presentation. It does not constitute or contain investment advice. It is not and shall not be construed as an offer, invitation, recommendation or solicitation tosell, issue, purchase or subscribe for any securities in any jurisdiction or to enter into any transaction. It is not and shall not be construed as an offer to arrange, underwrite, finance, purchase or sell any security, financial instrument, assets, business, or otherwise provide monies to any party. Suchoffers may only be provided in writing after satisfactory legal, financial, tax, accounting and commercial due diligence, as well as approval from the relevant business and credit committees of Lloyds TSB and/or their affiliates. The information contained in this Presentation is in summary form for theconvenience of presentation and may therefore not be complete.Products and services that may be referenced in the Presentation may be provided through affiliates of Lloyds TSB or any person connected with them.Lloyds Bank Corporate Markets, Lloyds TSB Corporate Markets and Lloyds TSB are trading names of Lloyds TSB Bank plc, Lloyds TSB Scotland plc and Bank of Scotland plc. Lloyds TSB Bank plc. Registered Office: 25 Gresham Street, London EC2V 7HN. Registered in England and Wales no. 2065.Lloyds TSB Scotland plc. Registered Office: Henry Duncan House, 120 George Street, Edinburgh EH2 4LH. Registered in Scotland no. 95237. Bank of Scotland plc. Registered Office: The Mound, Edinburgh EH1 1YZ. Registered in Scotland no. SC32700. Authorised and regulated by the Financial ServicesAuthority under registration numbers 119278, 191240 and 169628 respectively.This document is confidential, for your information only and must not be distributed, in whole or in part, to any person not involved with the proposed transaction without the prior consent of Lloyds TSB Bank plc (“Lloyds TSB”). Whilst Lloyds TSB has exercised reasonable care in preparing thisdocument and any views or information expressed or presented are based on sources it believes to be accurate and reliable, no representation or warranty, express or implied, is made as to the accuracy, reliability or completeness of the information contained herein. In particular, whilst we have soughtto identify appropriate products and to provide guidance as to how those products might operate under various accounting standards we are not, and should not be considered to be, giving an accounting opinion or advice and you should conduct your own independent enquiries and seek your ownprofessional advice in this respect. Any transaction which you may enter into with us will be on the basis that you have made your own independent evaluations based on your own knowledge and experience and any professional advice which you may have sought in relation to all aspects of thetransaction including legal, regulatory, tax or accounting.All terms contained herein, including pricing, are indicative only and subject to change without notice. This material has been prepared for information purposes only and Lloyds TSB, its directors, officers and employees are not responsible for any consequences arising from any reliance upon suchinformation. If you receive information from us which is inconsistent with other information which you have received from us, you should refer this to your Lloyds TSB Sales representative for clarification.Lloyds Bank Corporate Markets, Lloyds TSB Corporate Markets and Lloyds TSB are trading names of Lloyds TSB Bank plc, Lloyds TSB Scotland plc and Bank of Scotland plc. Lloyds TSB Bank plc. Registered Office: 25 Gresham Street, London EC2V 7HN. Registered in England and Wales no. 2065.Lloyds TSB Scotland plc. Registered Office: Henry Duncan House, 120 George Street, Edinburgh EH2 4LH. Registered in Scotland no. 95237. Bank of Scotland plc. Registered Office: The Mound, Edinburgh EH1 1YZ. Registered in Scotland no. SC32700. Authorised and regulated by the Financial ServicesAuthority under registration numbers 119278, 191240 and 169628 respectively.This presentation does not constitute or imply an offer or commitment whatsoever on the part of Lloyds TSB Bank plc (“Lloyds TSB”). Any such offer may only be made after the negotiation of satisfactory documentation and only after appropriate credit authority has been obtained. The pricingdiscussed herein is based on our view of current market conditions and is for discussion purposes only.This presentation and all ancillary documents relating to it (together the "Presentation") was prepared by Lloyds TSB exclusively for you for the purpose of analysing certain potential transactions. The Presentation is being made available on a strictly confidential basis to you and is intended only for theinternal use of authorised recipients (“Recipients”) and no part of it may be disclosed to any third party. This Presentation and the information contained herein are the property of Lloyds TSB. Recipients are hereby notified that photocopying, scanning, or any other form of reproduction, or distribution- in whole or in part - to any other person at any time is strictly prohibited without the prior written consent of Lloyds TSB.The information in this Presentation reflects prevailing conditions and our judgment as of this date, all of which are subject to change or amendment without notice and the delivery of such amended information at any time does not imply that the information (whether amended or not) contained in thisPresentation is correct as of any time subsequent to its date. Whilst Lloyds TSB have exercised reasonable care in preparing this presentation and any views or information expressed or presented are based on sources they believe to be accurate and reliable, neither Lloyds TSB, nor any of their officers,servants, agents, employees or advisors make any representation or warranty, express or implied, as to the fairness, accuracy, adequacy, completeness or correctness of such information, nor as to the achievement or reasonableness of any projections, targets, estimates, or forecasts and nothing inthis Presentation should be relied upon as a promise or representation as to the future. Neither Lloyds TSB nor any of their officers, servants, agents, employees or advisors or any affiliate or any person connected with them accepts any liability whatsoever for any direct, indirect or consequentialdamages or losses arising from any use of this Presentation or its contents or otherwise arising in connection therewith. Lloyds TSB undertakes no obligation to update or correct any information contained herein or otherwise to advise as to any future changes to it. Applicable tax, accounting and legalconsiderations are subject to change and in all cases independent professional advice should be sought in those areas.This Presentation is provided for information purposes only: there has been no independent verification of the contents of this Presentation. It does not constitute or contain investment advice. It is not and shall not be construed as an offer, invitation, recommendation or solicitation to sell, issue,purchase or subscribe for any securities in any jurisdiction or to enter into any transaction. It is not and shall not be construed as an offer to arrange, underwrite, finance, purchase or sell any security, financial instrument, assets, business, or otherwise provide monies to any party. Such offers mayonly be provided in writing after satisfactory legal, financial, tax, accounting and commercial due diligence, as well as approval from the relevant business and credit committees of Lloyds TSB and/or their affiliates. The information contained in this Presentation is in summary form for the convenience ofpresentation and may therefore not be complete.Products and services that may be referenced in the Presentation may be provided through affiliates of Lloyds TSB or any person connected with them.Lloyds TSB and their affiliates prohibits employees from offering a favourable research rating or specific price target or changing a rating or target to get a mandate and Lloyds TSB and their affiliates prohibit research analysts from being compensated for involvement in investment banking transactions,except to the extent that such participation is intended to benefit investor clients. Lloyds TSB, their affiliates, their respective directors or officers or persons connected with them may have an interest in any financial instrument mentioned in this Presentation.Lloyds Bank Corporate Markets, Lloyds TSB Corporate Markets and Lloyds TSB are trading names of Lloyds TSB Bank plc, Lloyds TSB Scotland plc and Bank of Scotland plc. Lloyds TSB Bank plc. Registered Office: 25 Gresham Street, London EC2V 7HN. Registered in England and Wales no. 2065.Lloyds TSB Scotland plc. Registered Office: Henry Duncan House, 120 George Street, Edinburgh EH2 4LH. Registered in Scotland no. 95237. Bank of Scotland plc. Registered Office: The Mound, Edinburgh EH1 1YZ. Registered in Scotland no. SC32700 .Authorised and regulated by the Financial ServicesAuthority under registration numbers 119278, 191240 and 169628 respectively. 38
  39. 39. David Fowler – Regional Agricultural Manager Thank You
  40. 40. Planning for the Future Amanda Burden B.Sc (Hons), FAAV, MBIAC
  41. 41. Proud to be Agricultural• Luscombe Maye celebrating 140th Year 1873-2013• 6 Offices• 9 Rural Professionals• Covering Devon & Cornwall• Mostly specialised Professionals – Planning – Grants & Subsidies – Valuations – Landlord & Tenant – Compensation – Farm and Land Sales – Agricultural Advice
  42. 42. Why a Planning Application ?• Expansion of Farm Business• Diversification of Farm Business• Capitalise on Assets• Need for additional dwelling• Lifestyle change/Retirement• Wish to “get on”• Asset for future generations
  43. 43. National Planning Policy Framework • At its heart, presumption in favour of sustainable development – Economic role – Social role – Environmental role • Para. 55 states – Local planning authorities should avoid isolated homes in the countryside unless there are special circumstances such as • The essential need for a rural worker to live permanently at or near their place of work in the countryside • Optimal viable use of a heritage asset • Re-use of redundant (farm) buildings • Truly outstanding or innovative design
  44. 44. Planning Policy Statement 7 (PPS 7) Annex A – now defunct• Permanent Dwellings – Outline Application - • Agree “Principle” and demonstrate need – Reserved Matters application later – Layout - Appearance – Scale - Access – Landscaping
  45. 45. Specific Requirements• Functional Need• Financial Test• No other dwellings suitable and available close by (incl. “affordable”)• Full time worker• Suitable site (within “sight & sound”)
  46. 46. Conditions• Agricultural Tie on new dwelling and existing dwelling ?• Limit on size of dwelling – “Commensurate” with established needs – Affordable for future use• Landscaping• Plus others !!
  47. 47. Associated Problems• Already too many dwellings on farm ? – Split holding/business – Offer long-term FBT to son/daughter• Not viable ? Financial Test not met – Liaise with Accountant – Pay some tax !! – Remove Depreciation• Not “essential” functional need ? – Increase numbers for planning & breeding• Creating right impression ?
  48. 48. Temporary Dwellings• Demonstrate intentions to develop enterprise eg. Farmbuildings• Show business can be viable eg. Business Plan, Stock Numbers, Budgets• Functional Need – Why “essential” ?• No Disposal of “suitable” dwellings or no other dwellings close by• Siting and access are acceptable
  49. 49. Timing• Permission for temporary dwellings normally 3 years – Meet Financial test for permanent dwelling – Extensions not normally given over 3 year period – Will have to be removed and occupants made homeless if permanent criteria not fulfilled
  50. 50. Temporary Permission• PPS 7 says temporary permissions should not be given on sites where LPAs would not allow a permanent dwelling – More likely to support temporary dwelling – Gives opportunity to make business viable – Allows people to be on site – Mobile home up to 60’ x 20’ and no more than 2 pieces – not small !! Or other temporary structure
  51. 51. Plan Ahead• Seek advice from Professional/Agent not just from Planning Authority• Seek advice from you Accountant, Solicitor and Bank Manager – Capital Gains – Inheritance Tax – Borrowing• Get a Valuation – Consider your Options ?• Plan well in advance
  52. 52. Remember !!• Planning History on Sites - Hope Value ? – Withdrawals - Approvals – Refusals - Appeals• Conditions – Agricultural tie - Personal Permission• Consents normally last 3 years – Commence development subject to conditions (condition precedent) – Policy Changes – can renew permissions – re-apply well in advance
  53. 53. “The bad news is you’ll need a conditional use permit for the flight operations, a health permit for the brewing facility, and a pet permit for the menagerie. The good news is that this is a temporary use, so you won’t have to go through South Hams District Council.”
  54. 54. Planning for the Future Amanda Burden B.Sc (Hons), FAAV, MBIAC
  55. 55. Single Payment Scheme and Rural GrantsClaire Hoyte BSc (Hons) MRICS FAAV
  56. 56. Single Payment Update• EU has added 9 new countries since 2005• New budget needs to incorporate these countries• Single Payment will still be based on entitlements
  57. 57. Future of SPS• Uncertain as limited info from Brussels at present• EU commission carrying out review of CAP• Basic proposals published in October 2011• “Basic Payment Scheme”• Will include greening measures• Must have activated one unit of entitlement in reference year – currently 2011 but not finalised.• Not anticipated to start until 2015
  58. 58. What this means…• Entitlements still have a value for next two years• Flat rate value depends on Euro rate• Don’t change any details about business
  59. 59. Things to note for the 2013 year…• 1st March – SPS Claim forms released• 2nd April – Transfer deadline• 15th May – Claim deadline• MAPPING – Proposed 30 day rule• SOIL PROTECTION REVIEW
  60. 60. And for new farmers…..• New Entrants Scheme• This is a possibility for Young Farmers• Will be mandatory for all member states• Access to National Reserve• Top Up Payment
  61. 61. Grants• Catchment Sensitive Farming• Across UK – target areas• Whole of South Devon• £10,000 based on 50% cost• Including own labour
  62. 62. Catchment Sensitive FarmingOpen 1st March to 30th April
  63. 63. Other schemes…• Entry Level Stewardship• £30 per ha• Uplands Entry Level Stewardship• £62 per ha• Organic Entry Level Stewardship• £60 per ha plus £175 for 2 years conversion• Higher Level Stewardship – funding now ceased
  64. 64. Proud to be Agricultural• Luscombe Maye celebrating 140th Year• 1873-2013• 6 Offices• 9 Rural Professionals• Covering Devon & Cornwall• Specialised Professionals • Planning – Grants & Subsidies – Valuations • Landlord & Tenant – Compensation – Farm and Land Sales – Agricultural Advice
  65. 65. ANY QUESTIONS?
  66. 66. Please complete a feedbackform and stay for a chat and enjoy some light refreshments.

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