Tight deadlines in 2006 mean that planning of any entitlement
transfers is vital, says Fisher German's John Ikin.
Farmers and landowners need to manage their entitlements to
the new Single Farm Payment carefully to ensure they bring maximum
benefit to their farming businesses. Tight deadlines in 2006
mean that planning of any transfers is vital, warns rural property
consultants Fisher German. Care must also be taken when drawing
up agreements to ensure entitlements are not lost.
“This spring, for the first time, it will be possible
to transfer your entitlements,” points out Fisher German
rural property surveyor John Ikin. “Up until now farmers
have not been able to make transfers because the entitlements
have not been definitively established(1). This is now due to
take place in February or March 2006.
“But they will need careful consideration, particularly
where a change of occupation is anticipated due to a sale, end
or start of tenancy, retirement or a restructuring of the farming
business,” says Mr Ikin.
Farmers and landowners should agree other details of any new
tenancies before the entitlements are established, he points
out. This will ensure they do not miss the deadlines. Professional
advice should be sought to ensure the terms fit with the new
Timescales need to be taken into account, he notes. The Rural
Payments Agency (RPA), that is handling transfers, needs a minimum
of six weeks notice before the intended transfer date. This means
a final deadline of 2nd April, to meet the 15 May deadline for
submission of 2006 SP5 forms, and 19th March, which is six weeks
before 30th April to satisfy the ten month rule(2).
“But these are final deadlines - don't leave
things to the last minute. This is especially important with
these new transfers because there are a number of pitfalls to
be wary of if making a full transfer or leasing entitlements,” says
If leasing entitlements with land, any tenancy agreement needs
to run for exactly the same period as the lease, requiring greater
communication between landlord and tenant to ensure that all
relevant agreements correspond with the appropriate dates, Mr
Ikin advises. “A poorly-worded agreement or Farm Business
Tenancy, could mean you miss deadlines, lose the ability to claim
on the entitlements or possibly lose them altogether.”
Losing an entitlement to the Single Payment, which is now the
main source of subsidy income for all UK farms, can mean a serious
and permanent loss of income for landowners. Land without entitlement
may trade at a discount.
“The timescales are tight and the implications of getting
it wrong can be very damaging,” warns Mr Ikin. “At
Fisher German we are already advising many of our clients on
how they can best transfer or lease entitlements without putting
their business at risk. Every farmer and landowner contemplating
transferring entitlements should make it their New Year's
resolution to find out exactly what the implications are for
For further advice on the transfer of entitlements, call John
Ikin at Fisher German's Ashby de la Zouch office - 01530
1. All farmers and landowners who claimed entitlements
in 2005 will receive notification from the RPA that these have
been “definitively established” - officially
recognised by the Agency. To complete a transfer an RLE1 Form
is required from the RPA.
2. To qualify for the Single Farm Payment, the farmer or landowner
claiming the payment must state a ten-month period during which
he or she has direct control over the land on which the claim
is being made.
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