Claims by farmers under the Basic Payment Scheme (BPS) 2023 in England needed to be in place by midnight on 15 May 2023. After this date, entitlements have no value and will no longer be tradeable. This results in some tax advantages. Those who bought, were given or inherited entitlements and have made taxable gains on other asset sales or other disposals have the chance to reduce their capital gains tax bill. This can be done by making a negligible value claim, or possibly a claim for a loss on the extinction of an asset, see C1.321. When the milk quota was abolished in March 2015, many producers made negligible value claims on their purchased quota, setting off their losses on then worthless milk quota against other capital gains.
In the case of BPS entitlement values, 100% of the purchase price can be offset against other gains, along with any agents' and legal fees directly attributable to the transaction. Farmers should act now to plan for a claim. Farm tax advisers
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Web page updated on 24 Aug 2024 15:15