Andy Ritchie, Agriculture leader at Azets, the UK’s largest regional accountancy and business advisors to SMEs and Top 10 accountancy firm, comments on today’s Budget announcement:
“The extension of the reduced rate of VAT is good news for farm shops. Farmers who operate through limited companies will still benefit from corporate structures, although corporation tax rates will increase from April 2023 on profits above £50,000 rising to a rate of 25% when over £250,000. The enhanced capital allowances will benefit farmers investing in plant, particularly if losses can be carried back two years. Farmers should delay investment until 1 April 2021 when the “Super Deduction” commences. There are no immediate changes to Inheritance Tax, but those farmers and landowners with a clear succession path should still look to pass on property now under the favourable existing legislation.
“UK farmers can lead the agriculture world in the Green Recovery. The agricultural industry is in an excellent position to spearhead this if the Government provides clarity and support. Today’s announcement on the Green Investment Bank seems to be focused on larger infrastructure projects and offshore wind, rather than the SME businesses which are the backbone of the UK rural economy. However, it is hoped the community investment fund may help breathe new life into remote rural areas, including pubs and community facilities.
Finally, we welcome the new digital investment, as rural parts of UK are desperate for this, as well as the creation of freeports which will also help the industry. “