Lump sum exit scheme tax clarified

Lump sum exit scheme tax clarified

HMRC has clarified that payments made to farming businesses under the Lump Sum Exit Scheme (LSES) will be treated as the disposal of a capital asset and not as trading income. That brings the tax treatment in line with the sale of BPS entitlements and the same reliefs (such as business asset disposal relief from Capital Gains Tax) will be available where the other qualifying conditions are met. There had been some speculation that payments under the LSES could be taxed as income which would have created a disincentive to farming businesses to apply. Is is therefore useful that this has been clarified. The legislative changes will be included in the 2022-2023 Finance Bill but will be backdated to 6 April 2022.

Share this post



Other related News

Graphene from slurry

For those with an interest in these things there was a story on the Farming Programme this morning about...

Continue Reading...


Proportionality in boundary disputes

As well as providing an excellent summary of the law on how to go about the job of determining...

Continue Reading...


Compulsory mediation

As per previous posts here and here, compulsory mediation is now “baked in” to the court process for small...

Continue Reading...