We’re a 100 acre family farm in SouthWest Cornwall. Because land values and property prices here are extremely high and our income is very low, it’s about the worst case. There’s no way we or our son could ever afford to settle the tax burden on passing it on. We’re both in our early-mid sixties now and both we and our son are absolutely f^cked. As for a number of other aspects of Reeves’ budget, she appears to have put a bullseye on so many other low income and defenceless sectors of society, while protecting huge corporations and investors, that it beggars belief. I’m not angry, I’m absolutely bloody incandescent!🤬
I don't think farmland is that valuable in France. However you can't easily buy it if you don't plan on using it for farming, even though we do have some rich people buying it and having a couple of horses or something like that. I've just looked into it and there are inheritance taxes to pay when inheriting a farm. However there are ways to minimize them, for starters a farm is a company, and companies can be inherited using a tax "loophole" that lowers the taxes due. There is also something specific for farms. But overall I wouldn't be surprised a 10 million euros farm would lead to a more than 1 million euros tax bill. In France a 10 million farm is probably a wheat farm generating millions a year...
Historically/legally the French divide their farms between their children, which is why French farms are on average smaller than UK farms.The good news is that this demonstrates UK farmers can start to pay a relatively tiny amount of inheritance tax and allow their children to continue farming. Maybe keep this quiet during the protests. It gets worse because French farmers also pay inheritance tax on farmland too. Don't mention that the French also avoid VAT on private schools.
@@aesma2522land is a fraction of the value in France check out farming life at la forge Laura and declan will explain how they sold 9 acres in Ireland to 1200 acres in France
But Harry, you make comparisons about the value of the land, but the reason the land is so valuable is exactly because it's being used as a tax planning mechanism. The value of this land should soon start to reflect it's actual value in terms of food production making it far, far more affordable for those that want to expand their farms or enter the industry. It should also lower the IHT bill because the value is now normalised.
I'll leave this here from a report by the BBC who aren't exactly a friend of our Rachel. "There were a total of 462 inherited farms valued above £1m in 2021-22, according to HM Revenue and Customs (HMRC):" Farmers being asked to pay half of what we ordinary tax payers pay when we wish to pass on our inheritance to our kids.
This is probably what Bill Gates discussed with Starmer in Downing Street when he visited him last month. He knows lots about the subject being the largest farmland owner in the US. We'll just end up with unsustainable farming practices owned by degnerate billionaire globalists.
I think it is more of a run on Rich people buying farms or large holdings to avoid inheritance tax and the farmers are being punished without thought. Clarkson has been quite open and smug about his farm being inheritance free, which may have spurred the idea
There’s a vacuum cleaner guy, who’s purchased large swaths of Lincolnshire and Norfolk for that exact reason… Side note… he’s purchased lots and lots of family farms which people seemingly have been happy to sell to him.. also many agri merchants have gone under around here, as he has the purchasing power to deal directly with equipment manufactures..
This is going on and that is why land prices have risen to about 11k per acre. I do know of several horse farms in the area that are owned by wealthy people and only lose money. But, previously if you can operate under the pretence of commercial farming, no IHT.
It will be interesting to see if the prices of forest land and hotels with a functioning restaurant go up. Are these not also used as vehicles to avoid inheritance tax?
@@malcomthewasp the other problem with Dyson buying so much is that, in turn, it has raised the land values. So it’ll be harder for genuine people wanting to be farmers to get started and more tempting for farmers to sell. It’d be interesting to see what percentage of land he is farming a crop on too considering it’s 36000 acres he owns. It certainly seems he’s in it for tax dodging and experimenting rather than feeding people.
I think the answer to the entire conundrum lies in the sharp rise in recent years. Bankers buying farmland to avoid IHT. And rich industrialists whose business is not in Singapore... How do you fix that? Because it's making farmland completely ridiculous. Anyway, I wrote to my MP, sharing this. I recommend others do too.
If the farm land is £2.5 million the animals and machinery is still another 2-3 million. That’s not pushed up by speculation or tax planning. Government would still want 400k plus on that. It’s madness.
@@thecranksterWhere Harry lives Grade 1 agricultural land is going for £35K an acre that price is not driven by an industry that is marginally profitable, that is driven by the wealthy wanting to live somewhere nice while avoiding inheritance tax.
This whole policy smells of trying to fix just this I don't know how a reduction in land price would affect farmers finances but listening to harry here it sounds like it won't I think there needs to be a "family farm" clause plus a raise from that 1m
I believe inheritance tax relief should only be available to full time farmers and their full time successors on the farms they work and there should limits. Sir Dyson in my view with 250 employees should pay inheritance tax like everyone else as his his employees have too. In Ireland full farmers can leave or transfer to each of their children 4 million Euro of land, stock, machinery, farmhouse, entitlements and working capitial. When you take valuations which are very subjective this can be 5 million plus I think this is about I think the farmers in the Cotswolds are doing something wrong, probably should keep sheep or dairy and less machines, because lots of Irish farmers are making 60,000 euro on on much less land. Diary are disappointed that their income is back to 1600 per Ha. The direct grants are better there.
A farm around me in Hampshire was sold 3 years ago to a big corporation. Within 6 months my workshop rent was increased 350%…. as were all the other small businesses in the “business park” (knackered old farm sheds actually). The positives are that they are clearly working the asset more intensively as field margins have deduced from 10m to 2m wide, miles of hedges grubbed out, previously unworked fields put into crop (obviously using more advanced and expensive machinery), a massive grain dryer built and garages/buildings circa 2 football pitches constructed. Negative side effects are footpaths re-routed and tractor blasting down the back lane’s irresponsibly because they appear to be short term contractors that don’t know nor care whereas the old farmer lived in the community and understood dangerous blind corners etc.
And clever tax accountants who make sure they pay very little tax and of course as a business they can manage inheritance through corporation law - next they will shut the farm and build a 'solar farm' 😢
because the green belt and general protections of urbanising the countryside is very murky and grey. land that could only be used for a low return activity would naturally be priced very low, but the fact that it might not always be so and could one day get permission to build houses on etc makes it very valuable from a speculation point of view. the attractiveness of the asset class for dodging tax has also been its own worst enemy as people looking to park their riches pile in with their ill-gotten gains and push values well past what farming activity could justify itself. but no one complains when their asset is appreciating in value under their feet, only when that value is taxable is everyone up in arms. taking back that which should never have been is not a very popular telling of the tale compared to the sob story version if the government offered farmers the ability to irreversibly declare their farm land as forevermore only for farming, to the extent that the land became valued only as farmland, i wonder how many would write down their 'on paper' assets like that? to ensure that it could be handed down only as farmland under the threshold etc etc rather than a pile of many millions they want to debate should be tax free
17.48 in "then I think land will end up in the wrong hands" its no coincedence the day before the budget Starmer & Reeves had a meeting with William H Gates and his Gates foundation CEO. Starmer quote: "It was great to meet with Bill Gates this week. We discussed how the UK can support global health development and use the net zero goal to invest in science and technology, creating new jobs. Labour will boost growth and protect the environment with our Green Prosperity Plan." Bill Gates is the biggest private owner of farmland in the United States. In total, Gates owns approximately 242,000 acres of farmland with assets totaling more than $690m. Wake up Harry..
Big up from Germany 👍 Inheritance tax should be abolished right across the board. It's a killer of small business families. Even for private families. The tax has been paid many times already on the income. Meanwhile large tech companies get away with.. well I dont know.
In Germany only 15% of the business get inheritance taxed. If the children continue the business under the same circumstances. Farms can get up to 100% exemption. Stop spreading misinformation.
A common issue in Wales is the amount of farms left with no productivity. People inherit them tax free and then just sit on them without generating output from the land. A tax would mean that those taking on the farm are more likely to be committed to generating revenue from the land. Ie, if you want to take on the farm, you cant afford to let it sit doing nothing.
I guess the question is, if the land is worth way more than the profit that can be generated, then something else is impacting the value of the land ? What is that ? Speculating? Change of use? Other people hiding their cash from inheritance tax liabilities?
it's 100% rich people buying farms and land to tax dodge, which is what is actually hurting farmers as well as pushing up landprices hurting them more. This law stops them and will also drop land prices.
@@evulclownno it won’t they have it tied up in trust, this is about forcing small farmers off their land so that it can be bought up and turned into housing, we have pictures of the pm meeting with black rock ceos and bill gates who have bought up huge chunks of land in the USA.
@@evulclownnope supply and demand determines value, rich people making an investment will make money regardless because land is a finite resource in a small country like England
@@evulclown it's not a lie farmers got their land through inheritance when it was cheaper at the time of their ancestors but the average wage is still relatively low so they cannot afford the tax.
As an accountant, it's been an 'interesting' week. It isn't just APR that's under the cosh, it's the same for other businesses with BPR (business property relief). This seems to have gone largely unnoticed fir some reason. It's an utter disgrace. I act for a few farms, many people assume all farmers are rich, it is absolutely not the case.
@@LeighW1973 can you explain to me please why a £30million farm that generates 30k a year is even a thing ? I'm not versed in this but I'm sure you can easily make more than 1% in property and investments ? You could sell 1/4 of it and then buy tons of property and rent it out and make more than 30k a year and just chill in your big farmhouse that's been paid off and save up
the removal of BPR for trading companies is also a huge issue. Many farms operate as corporates anyway so their shareholders need to rely on BPR. APR relates to land held as an individual or partnership which is getting rarer these days. Labour totally clueless on all business matters.
Completely agree my family farm has a return of 0.5% on the value of the farm so it will take almost 20yrs profit to pay the tax bill it’s completely stupid
You got your maths wrong, you will need to pay tax on the profit before you can use it to pay IHT. If you sell land, you will need to pay capital gains…..it’s much worse than you think
It's supposed to be completely stupid. The WEF wants to make family farms completely inviable. It's all part of The Great Taking (see book and video of that name by David Webb). Be under no illusion, there is a plan to take family farms into corporate ownership. Act accordingly.
"I think the Labour Government are deeply mistaken, have been very badly advised" HARRY that is an INCREDIBLY well MANNERED thing to say. Personally as a blue collar TOWNIE my belief is currently BEGGERED at the actions of the current crop of "people" in Westminster. Thank you for this video.
As usual a very thoughtful and well researched video on a fundamentally important subject that is critical to the future of every farmer and UK resident.
Generational farmers are victims of the current tax structure. Land values are high because there is 100% relief and non farmers have bought farms to benefit from no inheritance tax. In a business context farm land is a piece of equipment or raw material from which income is generated - currently having been inflated by demand from people purchasing for tax benefit not to actually farm the cost is too high and margin too small. Land values need to drop by about 20% - this change to tax laws will deter the tax dodgers. when this happens the genuine farmers will benefit
people like harry, who is a rich man with a car magazine, are the rich people who bought farm land to avoid paying inheritance tax and drove the land prices up. This law ends that tax loophole. But what's funny is here people are watching a video by one of the rich people who causes problems to farms, in their greed to never pay tax to the country they live in, feeding everyone disinformation acting like this law change is an attack on farmers and not rich tax dodgers like him.
Bless you Harry. Keep up the good work. Very well put sir. I am also a farmer. The true ramifications of this have not been considered. The agricultural supply and support sector are also going to feel the effects of this.
What about having the inheritance tax only kick in if the son / daughter sells any land (above a certain threshold) within 5 years of inheriting. That then encourages them to continue farming which is what we need / want as a country.
I know nothing about this business but I always follow your other channel. Thank you for explaining it. I only hope most of the country see this video. It’s absolutely disgusting but this lot are systematically destroying the country, same as the last lot. They have no understanding of business generally and as someone self employed for 25 years it’s made me question whether it’s worth it anymore.
I sympathise. However, land is overvalued partially because of inheritance tax breaks. Most land sold today is not to farmers. Would losing this break bring land values back in the reach of farmers ?
@@londo776 IHT is of no relevance to tenant farmers, que the comments if the landowner sells the tenant will los their farm etc blah blah most are under Acts anyway. A land owner buys land as an investment a farmer farms it.
Governments are clueless. Literally. I wish you and all the other farmers well Harry. In fact I may join you all in London this month too, just need to change some existing diary commitments.
According to the Sunday Times, James Dyson paid an estimated £156m in taxes last year in the UK. Supermarkets have already announced Labour's budget is going to push up the price of food and drink. I'm sure that will impact you a lot more than Dyson.
@@bw1376 and? that's less than he should pay, we all pay tax he proportionally pays less. Also this topic is not every day tax, it is to avoid inheritance tax, aka when he kicks the bucket his multi million empire pays £0 to be passed on while the rest of the UK pays 40%. And in order to abuse this tax loophole hes bought up farm land, pricing actual farmers out of the market with land value rising...
@@evulclown Think we've got more chance getting rid of the rotten tax-obsessed Labour Party before Clarkson or Dyson kickinf the bucket. When will politicians start paying tax on their the donations and gifts they receive? Starmer should have paid £48,000.
A great speech and so important to get the word out there. We need to stop complaining in this country about the awful way it's being run and do something about it. Asap.
Harry, really enjoy your channels. I find it hard to buy your story that you farm ‘to be custodian of the countryside’ or ‘for the goodness of others’, bar your own children.
Thanks Harry. Yet again, you take what is not only a very complex item but also in this case, very emotionally charged, and you present it in a way that's understandable, compassionate and heart felt. Really enjoy you sharing with us your insights in to the world of farming. Both you and your mate Mr Clarkson, continue to do the sector proud. Cheers. Chris.
I fear it's land clearance for housing and solar, unfortunately, and by clearing our custodians of the countryside out of there living, whilst they can generate a tax income from the destruction of farming, they believe this is acceptable. The misunderstanding of asset value required, v/s yearly income, was so well explained. Unfortunately, above the intelligence of those that should be building a better country, not dismantling it.
It's not above their intelligence; but they have zero interest in building a better country. In fact, they want to destroy it and they are already well on their way to doing it. They don't think like we do. They have a plan to take all small businesses into corporate ownership.
To look at this from another point of view, are you not arguing to keep the cart before the horse in perpetuity? There has to be good reasons why farmland has been consistently sold for far more per acre, than can be justified on the basis of growing crops or livestock. Why haven't farmers been protesting for the last decade to remove land inheritance, development and speculation tax breaks, so they can be left in peace to grow crops and manage the land sustainably. I nearly bought some grade 2 arable land in 1992 for £1500 an acre, which could just about provide a purely farming return on investment. The policies that have happened since then, to create this bubble, should have been derided by the CLA , NFU etc etc at the time. The deafening silence for years , means I am now struggling to shed many tears.
Exactly. Farmers could easily choose to protest to keep farm land only for farming. This would keep down the price of farmland and avoid inheritance tax. Farmers are complaining because they are far more concerned about keeping inherited wealth. It is all about greed.
@@johnsmith-ls4rc it does they just don’t want to sell it and want to moan about being hard done by when in actual fact they are still taxed less than anyone else.
A few questions if i may? What's the difference in tax situation if the land is owned by an individual, or a business? Secondly, the gov website I looked at didn't mention machinery and livestock; are you sure that would be taxed? Finally, slightly different question. Of the people in the UK who call them selves farmers; how many own / will inherit a farm? And how many work on a farm as an employee or contractor?
Great video. Actual example numbers set out clearly - which has been lacking on all the major news channels so far. Key analysis for me is that on a typical farm facing a £1.2m inheritance tax bill but the farm earns £60k profit in a good year it would take 20 years of ALL of the farm profit to pay it off. What do the farmer and his family live on in that time? What about bad harvest years when there is a loss? What happens after 10 years when only half the inheritance tax debt has been paid off - does HMRC send in the baliffs to sell the farm. Its a ludicrous situation.
Harry, couldn’t agree more. Love both your channels. But Reeves didn’t stop at the savaging of farmers. IHT now on inherited private pensions, at 40%. That will cost my kids dearly. Public sector? Nada.
Harry kind of said it but didn’t… a lot of land is going to come onto the market. These policies are all about forcing family businesses out and allowing corporate institutions in, very likely re-purposed for building. It’s economic engineering at its worst, forced by the hand of government and not the free market.
I think they should relook at it and make sure that the relief of Inheritance Tax for farming is genuine rather than rich people purchasing farms not really producing any quantity of food or adding to the UK food security and getting the 100% relief. I would say there should be a quota on the Inheritance Tax based on a tier of food production. Maybe you might need to zone that based on regions of the UK so the productivity of land is accounted for. Either way there is a middle ground here that should be found.
Great presentation Harry, thankyou for explaining the situation in a way that non farmers can understand. I agree something has to happen prior to the implementation of this ridiculous scheme, personally I hope it's in the form of a general election.
Sadly it’s not just farmers, it’s pretty much every privately owned SME in the country! Not surprised, this Government has absolutely no business experience within their fold, they’re all civil servants!
they are getting a 50% reduction. How have the Tories supported business over the past 14 years? Most other people are angry about food banks, NHS waiting lists and crap education.
@@Xyzabc998 They had no alternative. People on PAYE are already taxed to the max. This video goes under the banner of "nice try". I think a garage full of supercars tells the story.
So ok what has Clarkson got to do with it ? In it for the tax dodge ? So your other farm paid inheritance tax before 1984 and not paying tax has helped pay for subsequent farms !
I think Harry and many genuine farmers will forget that not everyone is playing the honest game. We all know there is no IHT on this, the ten fold increase in farm land is not because of the high return being a farmer is it?
@@fraserwright9482 Harry sold his previous farm for housing and bought a nice house in the Cotswolds with farm attached. Limiting his IHT and allowing him to amass a nice collection of tax efficient classic cars. Maybe not such an honest game, but I think most farmers would love to do the same if they are honest about it.
@@fraserwright9482 They're not forgetting. Family farmers are incredibly shrewd businessmen who are able do things like... start car magazines. It's not by mistake that they're suddenly not mentioning the ability to sell equity, or that they depend on poorer contract farmers who inherit piss all. Their only flaw is forgetting how unconvincing it is to cry wolf when their other youtube channel is showing off their massive car collection.
Another excellent video on this serious subject. There is space, though, for a little humour, the motor sport inspired slip of the tongue at 46 seconds🙌
Great summary Harry - couldn't agree more and as a non-farmer in a rural town I would fully support any action farmers choose to take. Glad you mentioned the idea of tapering - it IS unjust and I think totally wrong that a small number of very wealthy people can avoid tax on thousands of acres - that's not about 'politics of envy' - it's about fairness. As you say they'd probably just avoid it another way sadly, but principles matter. For ordinary family farmers though this is devastating and, let's hope, between now and 2026 the government will come to appreciate the need for change. Keep talking!
Well the value of farmland has shot up because of people buying it purely to avoid inheritance tax. Clarkson, Dyson and many more. This should now stop and there will be some investors getting out because this tax relief has gone. Farmland prices should drop reducing the IHT bill. There will also be opportunities for new younger farmers to enter farming as more farmland comes onto the market. Eventually farmland prices might have some relationship to what a farming business can sustain.
Rubbish . How long is "Eventually"? What happens in the meantime while your "Eventually " plays out? This is obviously a Starmer plant and you will be forced to recant .
Thanks Harry for this, a well considered appraisal of the Budget implications. Let’s hope government will appreciate the impact on farmers and the countryside.
Bill Gates visited Starmer in Downing Street last month. Gates think he knows lots about farming as he is now the largest owner of farmland in the US. Labour's policy will mean we will just end up with unsustainable megafarms owned by degenerate billionaires.
That goes both ways. I don't expect farmers are thinking about the inheritance tax on fairly ordinary houses in London that people want to pass on to their children.
It is worth noting that in your example of a £1.2 million tax bill which can be paid by instalments over 10 years, interest is payable on the outstanding balance each year after the first anniversary. as well. So on the second instalment of £120,000, there is a further £78,000 of interest to pay, making almost £200,000.(There is no interest on the first instalment if paid on time.)
Another good video, all the figures laid out. 100% agree with you. Maybe it is time to hold back on supplying. I'm sure they'll get pissed off when they've had no milk for a few days.. 🚜"NO FARMS, NO FOOD, NO FUTURE"🚜
All in how much will they actually make from this - Feck All in the bigger scheme of things.. Im not a Tory ( Scotch Irish) but what part of you grow our food is hard for Governments to comprehend !!!! Great Vid - Great Channel ever in Frankfurt beers on me !1 SLAINTE !!!
This talk in the comments about tax dodging and rich people is a story to sell this new law to the public at large. It is a side issue. Inheritance tax is a way to keep people poor, born poor, die poor. Everybody starts from zero, and the idea of a "family" is thwarted by economic means.
The farm/land has no value until it is sold, and at that point and only at that point should it be subject to tax. If Labour, or any government for that matter cannot understand that, we are in trouble. Perhaps the banks that specialise in farming need to join the farmers to challenge this ludicrous tax change.
This is the obvious solution. No tax is due all the time the farm is active. If the kids inherit the farm and decide to sell it off for redevelopment then tax them on the proceeds of the sale.
@@chiefsilverback Solution to what? I think you missed the point of the change. It is meant to bankrupt the small farmers so they are forced to sell their land to government endorsed giant corporations. This is THE PERFECT solution.. :D
Lots of things are taxed without sale. Tax is merely a mechanism for the government to make money whilst ecouraging certain behaviours and discouraging others. Lots of reasons to disagree with the policy, but that isn't one.
Everyone else in the UK that needs to pay 40% inheritance tax at a far lower threshold than is being proposed for you (£1,500,000 - £3,000,000 before paying 20% instead of 40% over 10 years) don't matter of course... It's okay we'll just pay to prop you up and rich people who buy farms as a tax loophole, don't worry.
@@evulclown close the loop hole. If the farm has been in continuous use for XX years, and remains in continuous use for YY years after inheritance then no tax. As Harry points out in this video, a £5,000,000 'asset' may only turn £100,000/profit, so it would take 10 years of profit to pay off the inheritance tax, and what does the farmer live on for that decade? If you inherit £5,000,000 in cash it's very easy to count off 20% of it and pay the tax bill, but you can't just pull 20% of the value out of working farm.
What doesn’t help is celebrity’s like JC writing articles in the past saying he’s bought a farm as his dependents wouldn’t need to pay inheritance tax on that money tied up in a form.
Should be 100% exempt from IHT as long as the farm remains in the family. If it is sold in the following 25 years, IHT should be clawed back at the time of the sale.
But I guess if a farm is sold later or at any time it would attract Capital Gains Tax anyway on Sale so you surely couldn't have IHT and Capital Gains applied together ..
Why? So the UK tax payers prop up your poorly managed nepotism with massive amounts of land and paying no tax back to a society you benefit from and live in? Don't worry it's only 20% for farmers, the rest of the UK pays 40% so we're still propping you up.
I'm sorry that it's such a surprise. When you said the return on capital is poor, and that it's not the farmers fault that the value of the land has gone up. I think that's the point. The value of the land has gone up, mainly due to speculation about planning etc, and you're right, they aren't farming. But there's also inflation in land values due to avoidance of inheritance tax - Dyson isn't farming his land. Labour are trying to target those who own the land but don't do anything with it. It seems to me like they are hoping if dyson etc have to sell the land, but 2026 april, land values would have fallen so much that the actual inheritance tax bill would be minimal. Especially if it's net assets, and mortgage debt would count against it. I want to go back to your poor return on capital point. Working the land makes no money. Speculating on the land does. And that is, I think, the issue. One person's land wealth is another young farmers land unaffordability. If land values drop precipitously, yes there might be fewer family farms but they could also be more farmers overall!
@@martinjagfansmith you're right, i don't know what dyson is doing with the land! i'm assuming he's not farming because as harry says, farming makes no money. and yes i agree that dyson avoiding inheritance tax is ridiculous and we need to do what we can to stop it
@@TheoneandonlyRAHhe is farming, one of the largest pea producers in the UK. It's not clear if the land is held personally, in a business, or some other way. There are a couple of recent TH-cam videos showing the farms. Seems to be particularly interested in the technology, e.g. robotised greenhouses, technology that could eventually be commercialised. I personally find it quite interesting as I live somewhere (Kenya) with inconsistent rainfall that has a big impact on crop yields. Greenhouse farming is already quite big, but automation is low because there is little competition for labour and therefore wages are low.
@@russellpengilley5924 yep kenya is full of greenhouses isnt it? a big centre for flowers and green veg iirc? glad to hear dyson is farming. still think iht has a chance of being net positive for farmers in general, but glad to see he's innovating in the field
@@TheoneandonlyRAH yes, flowers and higher value vegetables like green beans, sugar snap peas and baby corn. The cool chain logistics setup is quite impressive.
This tax relief introduced in the 70s to help family farms was broadened to shares in other businesses like Self-storage, leasing...there are loads. That allowed the development of investment funds which invest in them, and then savers, you or me, can buy shares in the fund, and these shares can be passed on IHT free. This may be one factor that caused land prices to spike more than farm profitability justifies. The relief could be restricted to the testator, and pethaps beneficiary, working full time in the business being passed on.
According to the Sunday Times, James Dyson paid £156m in taxes in the UK last year. All this is going to force small family farmers out of business while Starmer's new friend Bill Gates starts buying up land. He's already the largest owner of farmland in the United States.
And, as usual, the Labour party has a knee jerk reaction that has a major detrimental impact on all but the ones they're supposedly targeting. Remember IR35 to catch Greg Dyke? Massive impact on the freelance workforce who have been progressively forced into inflexible permanent employment, just the thing to increase growth. Or is it?
Harry you are such a details man who brings a lot of attention to farming via people like me who found you via Evo and your car channel. There are some real challenges around food production, food security and the sustainability of farming in the UK. This plus Brexit and the change in subsided payments seems to be a huge issue, my question is where are we at in terms of level of crisis , is this as big/bad as foot and mouth etc.
US influence in the UK is getting egregious in the extreme now. They are the worst societal mentor you could pick outside of the obvious ones. Instead of high profile Americans “advising” we should be looking to places like Scandinavia, the Netherlands. They get far more things right (not everything obviously) than our “cousin” across the pond.
Very succinctly put Harry. Loved how you didn’t talk specifically about your situation as well that was a nice touch. It’s a bad situation that hopefully as the dust settles gets tweaked. It was a pleasure to meet you yesterday evening. Thanks for chatting to me about cars and roads.
To be clear, I don't disagree with his concerns but, to be honest, it would be tricky for a guy with a multi-million pound car collection to talk about 'scratching around to make a living'
@@Stu_2112 He has worked and taken financial risks for nearly 40 years to have what he now owns and enjoys with the rest of us. Yes he makes money from TH-cam but so do the BBC Sky etc. Get a grip!!
Morning Harry watched this video last week . Brilliant, the passion for farming really comes through. Unfortunately, this is another government that's he'll bent on ruining another one of this country's industries. There used to be a thriving international haulage industry in this country that's gone. The London taxi driver industry is gone, and they keep talking about growth embarrassing
Hi Harry. If, as they state, Labour’s primary reason for scrapping the 100% IHT for farmers is to capture those non-farmers who have invested heavily in land as a way of avoiding IHT - giving them a generational tax shelter for their wealth - then why do they not amend the rules and grant 100% relief to those farmers who are farmers; by using the same eligibility criteria as would be used for a tenant farmer who wants to pass on his generational tenancy to the next generation? This would mean that only those farmers whose principal source of income (at least 50%) was earnt from farming the land out of at least 5 of the last 7 years prior to their death. As many land investors, such as James Dyson, Jeremy Clarkson, pension funds and so on, would not qualify under this criteria, they would not get IHT relief and so achieve Labour’s stated aims. Whereas the family generational farmer whose principal source of income is the farm, would. Would you be willing, Harry with the influence and platform that you have, to raise this key point with Labour and so take the focus off the £1m limit and onto what the stated purpose of the change is for? How could they argue with using the succession clause which is already written in law for tenant farmers who pass on their tenanted farms, when it would effectively sift out the ‘wheat’ from the ‘chaff’ by bringing to light who was a farmer who depended on their income from the land (the ‘wheat’) and who was not (the ‘chaff’)? With best wishes
I think though that one of the reasons values have shot up recently though is because the likes of James Dyson and your neighbours have been buying up agricultural land solely to benefit from relief. This measure may lead to a significant reduction in land values, reducing the IHT issue and also giving young farmers the opportunity to get into the industry without taking on stratospheric levels of debt
If y’all were in a non-farm biz and your family owned the biz, the transfer of the ownership, between family generations, wouldn’t that transfer require inheritance tax?
@@Padoinky no, not before if the kids worked in the business. Now any family business will need to pay IHT on the business asset. There will be no family firms left just big corporations
why shouldn’t the farmers pay everyone else has too and if i’m not mistaken didn’t you take the last governments offer to not farm and plant “wild flowers” for birds because of the money ?
@@MrAndyS you are wrong, a corporate business does not PAY IHT. That is why family firms (not just farmers) do not pay IHT when passed to a family member in the same business.
Since WW2 the return on owned farmland has been around 1.5% pa. Before then it was worse. Right now income support for farming has effectively been removed and market prices are not shifting so farm incomes must fall. Economy of scale works in farming, and debt doesn't. Banks will be very very cautious. I agree with Harry....watch this space. Either the government backtracks or we are looking at the start of a skewed farmland nationalisation.
Great? Farms should be in the hands of whoever creates the most food, for the least environmental damage. And farm size dropping and land values dropping is necessary to allow new farmers in.
@@louisholden5127 There is a pretty strong argument that the state should own the land. The whole idea that someone like Dyson can buy up huge tracts then lease it to tenant farmers is obscene. We are paying for that as subsidies to farmers will end up in these landlords pockets.
Harry, very well explained. As you mentioned it is hobby farmers who use the farm as a tax wrapper to protect their wealth. They do just enough to be seen as a farmer
People are taxed to death in this country, just the way it is unfortunately. Also, on a slightly less relevant side note, King Charles paid zero inheritance tax, but everyone else still has to pay it, seems kind of unfair, doesn't it?
@@ruststar Before the Normans, British monarchs were no more and no less than the first among equals. It's now time for the royal privileges, which are hangover from Norman/feudal times, to be abolished. Royalty should pay tax like everybody else. The Duchies of Cornwall and Lancaster should be transferred back into The Crown Estate.
It's Called Debt Slavery to The Uk Corporation City of London....... Anyone who has a Birth Certificate is required as traded chattle to Make 'The System Money' !
What a cozy dairy barn you show in this VLOG. My family's farm in the United States had to grow to thousands of acres of cropland before the income stream allowed the transition away from dairy operations. At that point, some years ago, 700 cows were being milked using highly automated milking stations. The alternative was to employ a team of immigrants and to teach them how to milk. Waste treatment was also an issue and a cost.
Very well put and explained harry. you have explained this new 20% inheritance gift from labour very well. Typical labour tax and more tax and clobber anybody who lives and works in the country side.
Can you explain what you mean by 40% tax on pensions? Right now, if you earn over 50k in your pension, you pay 40% on whatever is over 50k. This seems pretty fair as someone able to fund a 50k+ pension was probably getting the higher rate tax relief on some of their contributions.
@@JohnnyMotel99 My limited understanding is that you could leave any unused defined-contribution (money-purchase) pension to your children without paying inheritance tax - until Rachel Reeve’s budget removed this loophole.
We’re a 100 acre family farm in SouthWest Cornwall.
Because land values and property prices here are extremely high and our income is very low, it’s about the worst case.
There’s no way we or our son could ever afford to settle the tax burden on passing it on.
We’re both in our early-mid sixties now and both we and our son are absolutely f^cked.
As for a number of other aspects of Reeves’ budget, she appears to have put a bullseye on so many other low income and defenceless sectors of society, while protecting huge corporations and investors, that it beggars belief.
I’m not angry, I’m absolutely bloody incandescent!🤬
Why can you not gift the farm to your son early in order to avoid the tax? Does the 0% tax after 7 year rule not apply to this?
@@isolationstation5157 exactly … planning … it’s what we all have to do.
@@isolationstation5157is it at all possible to gift 10+ million £ with 5-10 k a year 🤷♂️
@@isolationstation5157 if you benefit from the land or property then it is an invalid gift.
Plus there maybe other taxes in changing ownership
@@isolationstation5157 By doing this would it not trigger a CGT issue that could create a far worse situation?
I think it’s fine to be taxed if the person inherits and sells but it ludicrous to tax them if they are continuing to work the farm.
Exactly this!
Imagine this happening in France!... they'd soon put their government back under their rock 💯
It's already happened in Holland but govt used nitrogen as an excuse to rob the land.
Paris would be full of tractors by now...and manure.
I don't think farmland is that valuable in France. However you can't easily buy it if you don't plan on using it for farming, even though we do have some rich people buying it and having a couple of horses or something like that.
I've just looked into it and there are inheritance taxes to pay when inheriting a farm. However there are ways to minimize them, for starters a farm is a company, and companies can be inherited using a tax "loophole" that lowers the taxes due. There is also something specific for farms. But overall I wouldn't be surprised a 10 million euros farm would lead to a more than 1 million euros tax bill. In France a 10 million farm is probably a wheat farm generating millions a year...
Historically/legally the French divide their farms between their children, which is why French farms are on average smaller than UK farms.The good news is that this demonstrates UK farmers can start to pay a relatively tiny amount of inheritance tax and allow their children to continue farming. Maybe keep this quiet during the protests. It gets worse because French farmers also pay inheritance tax on farmland too. Don't mention that the French also avoid VAT on private schools.
@@aesma2522land is a fraction of the value in France check out farming life at la forge Laura and declan will explain how they sold 9 acres in Ireland to 1200 acres in France
But Harry, you make comparisons about the value of the land, but the reason the land is so valuable is exactly because it's being used as a tax planning mechanism. The value of this land should soon start to reflect it's actual value in terms of food production making it far, far more affordable for those that want to expand their farms or enter the industry. It should also lower the IHT bill because the value is now normalised.
I'll leave this here from a report by the BBC who aren't exactly a friend of our Rachel.
"There were a total of 462 inherited farms valued above £1m in 2021-22, according to HM Revenue and Customs (HMRC):" Farmers being asked to pay half of what we ordinary tax payers pay when we wish to pass on our inheritance to our kids.
This is probably what Bill Gates discussed with Starmer in Downing Street when he visited him last month. He knows lots about the subject being the largest farmland owner in the US. We'll just end up with unsustainable farming practices owned by degnerate billionaire globalists.
The average farmer revenue in profit every year is only 45000 so they don’t have the money
I think it is more of a run on Rich people buying farms or large holdings to avoid inheritance tax and the farmers are being punished without thought. Clarkson has been quite open and smug about his farm being inheritance free, which may have spurred the idea
There’s a vacuum cleaner guy, who’s purchased large swaths of Lincolnshire and Norfolk for that exact reason…
Side note… he’s purchased lots and lots of family farms which people seemingly have been happy to sell to him.. also many agri merchants have gone under around here, as he has the purchasing power to deal directly with equipment manufactures..
This is going on and that is why land prices have risen to about 11k per acre. I do know of several horse farms in the area that are owned by wealthy people and only lose money. But, previously if you can operate under the pretence of commercial farming, no IHT.
This is why they did it. You have them to thank
It will be interesting to see if the prices of forest land and hotels with a functioning restaurant go up. Are these not also used as vehicles to avoid inheritance tax?
@@malcomthewasp the other problem with Dyson buying so much is that, in turn, it has raised the land values. So it’ll be harder for genuine people wanting to be farmers to get started and more tempting for farmers to sell. It’d be interesting to see what percentage of land he is farming a crop on too considering it’s 36000 acres he owns. It certainly seems he’s in it for tax dodging and experimenting rather than feeding people.
I think the answer to the entire conundrum lies in the sharp rise in recent years. Bankers buying farmland to avoid IHT. And rich industrialists whose business is not in Singapore...
How do you fix that? Because it's making farmland completely ridiculous. Anyway, I wrote to my MP, sharing this. I recommend others do too.
Exactly this. I’m very disappointed Harry completely neglected to cover this argument.
If the farm land is £2.5 million the animals and machinery is still another 2-3 million. That’s not pushed up by speculation or tax planning. Government would still want 400k plus on that. It’s madness.
@@thecranksterWhere Harry lives Grade 1 agricultural land is going for £35K an acre that price is not driven by an industry that is marginally profitable, that is driven by the wealthy wanting to live somewhere nice while avoiding inheritance tax.
This whole policy smells of trying to fix just this
I don't know how a reduction in land price would affect farmers finances but listening to harry here it sounds like it won't
I think there needs to be a "family farm" clause plus a raise from that 1m
@@LauraDempsey I don't think he neglected to, the programme is pretty full, you can only cover so much IMO.
Side note. Inheritence tax doesn't happen to corporate farms. This is an attack on family farms.
They want the land and farms in the hand of the government like the old soviet Russia.
VERY GOOD POINT.
Unfortunately, it will
I believe inheritance tax relief should only be available to full time farmers and their full time successors on the farms they work and there should limits. Sir Dyson in my view with 250 employees should pay inheritance tax like everyone else as his his employees have too. In Ireland full farmers can leave or transfer to each of their children 4 million Euro of land, stock, machinery, farmhouse, entitlements and working capitial. When you take valuations which are very subjective this can be 5 million plus I think this is about I think the farmers in the Cotswolds are doing something wrong, probably should keep sheep or dairy and less machines, because lots of Irish farmers are making 60,000 euro on on much less land. Diary are disappointed that their income is back to 1600 per Ha. The direct grants are better there.
This is the point……that is why it’s so unfair. Let’s tax corporate farms every 60 years…..
A farm around me in Hampshire was sold 3 years ago to a big corporation. Within 6 months my workshop rent was increased 350%…. as were all the other small businesses in the “business park” (knackered old farm sheds actually). The positives are that they are clearly working the asset more intensively as field margins have deduced from 10m to 2m wide, miles of hedges grubbed out, previously unworked fields put into crop (obviously using more advanced and expensive machinery), a massive grain dryer built and garages/buildings circa 2 football pitches constructed. Negative side effects are footpaths re-routed and tractor blasting down the back lane’s irresponsibly because they appear to be short term contractors that don’t know nor care whereas the old farmer lived in the community and understood dangerous blind corners etc.
And clever tax accountants who make sure they pay very little tax and of course as a business they can manage inheritance through corporation law - next they will shut the farm and build a 'solar farm' 😢
@@charlesmoss8119 well there is a clue in their name RedBrown… literally 🤪
It begs the question as to why the land value doesn’t reflect the economic value of the farming operation?
APR?
because the green belt and general protections of urbanising the countryside is very murky and grey. land that could only be used for a low return activity would naturally be priced very low, but the fact that it might not always be so and could one day get permission to build houses on etc makes it very valuable from a speculation point of view.
the attractiveness of the asset class for dodging tax has also been its own worst enemy as people looking to park their riches pile in with their ill-gotten gains and push values well past what farming activity could justify itself. but no one complains when their asset is appreciating in value under their feet, only when that value is taxable is everyone up in arms. taking back that which should never have been is not a very popular telling of the tale compared to the sob story version
if the government offered farmers the ability to irreversibly declare their farm land as forevermore only for farming, to the extent that the land became valued only as farmland, i wonder how many would write down their 'on paper' assets like that? to ensure that it could be handed down only as farmland under the threshold etc etc rather than a pile of many millions they want to debate should be tax free
Simple answer is that they ain't makin any more! Some truth in that.
Everyone needs to share this video, spread the word.
Well done Harry
17.48 in "then I think land will end up in the wrong hands" its no coincedence the day before the budget Starmer & Reeves had a meeting with William H Gates and his Gates foundation CEO.
Starmer quote: "It was great to meet with Bill Gates this week.
We discussed how the UK can support global health development and use the net zero goal to invest in science and technology, creating new jobs.
Labour will boost growth and protect the environment with our Green Prosperity Plan."
Bill Gates is the biggest private owner of farmland in the United States.
In total, Gates owns approximately 242,000 acres of farmland with assets totaling more than $690m. Wake up Harry..
Big up from Germany 👍
Inheritance tax should be abolished right across the board.
It's a killer of small business families.
Even for private families. The tax has been paid many times already on the income.
Meanwhile large tech companies get away with.. well I dont know.
Its bloody tyrannical and medi-evil.
In Germany only 15% of the business get inheritance taxed. If the children continue the business under the same circumstances. Farms can get up to 100% exemption. Stop spreading misinformation.
Starmer and the WEF are using Inheritance Tax deliberately to make family businesses inviable.
@@pnsp33 Perhaps that should be the criteria - if circumstances stay the same, remove the tax, but do it for all SMEs.
A common issue in Wales is the amount of farms left with no productivity. People inherit them tax free and then just sit on them without generating output from the land. A tax would mean that those taking on the farm are more likely to be committed to generating revenue from the land. Ie, if you want to take on the farm, you cant afford to let it sit doing nothing.
I'm not in favour of the tax, but I can see an argument for implementing it outside of it just being a cash grab.
Nope rich people will buy even more land as farmers sell and companies like black rock will flip to companies that build housing.
I guess the question is, if the land is worth way more than the profit that can be generated, then something else is impacting the value of the land ? What is that ? Speculating? Change of use? Other people hiding their cash from inheritance tax liabilities?
it's 100% rich people buying farms and land to tax dodge, which is what is actually hurting farmers as well as pushing up landprices hurting them more. This law stops them and will also drop land prices.
@@evulclownno it won’t they have it tied up in trust, this is about forcing small farmers off their land so that it can be bought up and turned into housing, we have pictures of the pm meeting with black rock ceos and bill gates who have bought up huge chunks of land in the USA.
@@evulclownnope supply and demand determines value, rich people making an investment will make money regardless because land is a finite resource in a small country like England
@@spearfisherman308 nah, why lie?
@@evulclown it's not a lie farmers got their land through inheritance when it was cheaper at the time of their ancestors but the average wage is still relatively low so they cannot afford the tax.
As an accountant, it's been an 'interesting' week. It isn't just APR that's under the cosh, it's the same for other businesses with BPR (business property relief). This seems to have gone largely unnoticed fir some reason. It's an utter disgrace. I act for a few farms, many people assume all farmers are rich, it is absolutely not the case.
@@LeighW1973 can you explain to me please why a £30million farm that generates 30k a year is even a thing ? I'm not versed in this but I'm sure you can easily make more than 1% in property and investments ? You could sell 1/4 of it and then buy tons of property and rent it out and make more than 30k a year and just chill in your big farmhouse that's been paid off and save up
@@LeighW1973 i agree, there are many multigenerational firms that will end up being sold to big corporations that don’t pay IHT.
Also as your job is to avoid people paying tax, what are the main loopholes that you see being exploited unethically that should be looked at?
@@fraserwright9482grow up…….i employ accountants to make sure I pay the correct tax.
the removal of BPR for trading companies is also a huge issue. Many farms operate as corporates anyway so their shareholders need to rely on BPR. APR relates to land held as an individual or partnership which is getting rarer these days. Labour totally clueless on all business matters.
Completely agree my family farm has a return of 0.5% on the value of the farm so it will take almost 20yrs profit to pay the tax bill it’s completely stupid
You got your maths wrong, you will need to pay tax on the profit before you can use it to pay IHT. If you sell land, you will need to pay capital gains…..it’s much worse than you think
And the next generation and the next
It's supposed to be completely stupid. The WEF wants to make family farms completely inviable. It's all part of The Great Taking (see book and video of that name by David Webb). Be under no illusion, there is a plan to take family farms into corporate ownership. Act accordingly.
Gift your land (not the house) to your kids,
7 years before you die.
After 7 years 0% of IHT
5-6 yrs 16%
4-5 yrs 24%
3-4 yrs 33% of IHT
Gift the land (not the house) to your kids,
7 years before dye.
After 7 years 0% of IHT
5-6 yrs 16%
4-5 yrs 24%
3-4 yrs 33% of IHT
"I think the Labour Government are deeply mistaken, have been very badly advised" HARRY that is an INCREDIBLY well MANNERED thing to say. Personally as a blue collar TOWNIE my belief is currently BEGGERED at the actions of the current crop of "people" in Westminster. Thank you for this video.
As usual a very thoughtful and well researched video on a fundamentally important subject that is critical to the future of every farmer and UK resident.
It's not that well researched because the numbers are up for debate.
Generational farmers are victims of the current tax structure. Land values are high because there is 100% relief and non farmers have bought farms to benefit from no inheritance tax. In a business context farm land is a piece of equipment or raw material from which income is generated - currently having been inflated by demand from people purchasing for tax benefit not to actually farm the cost is too high and margin too small. Land values need to drop by about 20% - this change to tax laws will deter the tax dodgers. when this happens the genuine farmers will benefit
people like harry, who is a rich man with a car magazine, are the rich people who bought farm land to avoid paying inheritance tax and drove the land prices up. This law ends that tax loophole.
But what's funny is here people are watching a video by one of the rich people who causes problems to farms, in their greed to never pay tax to the country they live in, feeding everyone disinformation acting like this law change is an attack on farmers and not rich tax dodgers like him.
Excellent video Harry, covers the topic very well.
Bless you Harry.
Keep up the good work.
Very well put sir.
I am also a farmer.
The true ramifications of this have not been considered. The agricultural supply and support sector are also going to feel the effects of this.
Labour will destroy this country, they have already lost the next election
What about having the inheritance tax only kick in if the son / daughter sells any land (above a certain threshold) within 5 years of inheriting. That then encourages them to continue farming which is what we need / want as a country.
I know nothing about this business but I always follow your other channel. Thank you for explaining it. I only hope most of the country see this video. It’s absolutely disgusting but this lot are systematically destroying the country, same as the last lot. They have no understanding of business generally and as someone self employed for 25 years it’s made me question whether it’s worth it anymore.
Guard and protect our farmers bless them all
I sympathise. However, land is overvalued partially because of inheritance tax breaks. Most land sold today is not to farmers. Would losing this break bring land values back in the reach of farmers
?
Most small time farmers will lose their land a business this does not affect rich people who don't farm.
There needs to be more focus on farmers vs landowners
why?
@@londo776 IHT is of no relevance to tenant farmers, que the comments if the landowner sells the tenant will los their farm etc blah blah most are under Acts anyway. A land owner buys land as an investment a farmer farms it.
Well done for getting involved Harry .
Governments are clueless. Literally. I wish you and all the other farmers well Harry. In fact I may join you all in London this month too, just need to change some existing diary commitments.
Brilliantly explained!
this is terrible , we need to support the farmers of the uk . this government needs to go .
I didn't vote for them. Seems the majority in the country wants this. Or were too stupid to realise the consequences.
I blame your neighbour Jeremy and James Dyson . If the land doesn’t earn an income the land value is too high .
Yeah, if these people didn't game the system to avoid paying tax none of this would be necessary.
According to the Sunday Times, James Dyson paid an estimated £156m in taxes last year in the UK. Supermarkets have already announced Labour's budget is going to push up the price of food and drink. I'm sure that will impact you a lot more than Dyson.
@@bw1376 and? that's less than he should pay, we all pay tax he proportionally pays less.
Also this topic is not every day tax, it is to avoid inheritance tax, aka when he kicks the bucket his multi million empire pays £0 to be passed on while the rest of the UK pays 40%. And in order to abuse this tax loophole hes bought up farm land, pricing actual farmers out of the market with land value rising...
@@evulclown Think we've got more chance getting rid of the rotten tax-obsessed Labour Party before Clarkson or Dyson kickinf the bucket. When will politicians start paying tax on their the donations and gifts they receive? Starmer should have paid £48,000.
A great speech and so important to get the word out there. We need to stop complaining in this country about the awful way it's being run and do something about it. Asap.
Great video Harry. You've really helped with explaining this mess created by our wonderful government. Many thanks 👍🏼
Harry, really enjoy your channels. I find it hard to buy your story that you farm ‘to be custodian of the countryside’ or ‘for the goodness of others’, bar your own children.
Thanks Harry. Yet again, you take what is not only a very complex item but also in this case, very emotionally charged, and you present it in a way that's understandable, compassionate and heart felt. Really enjoy you sharing with us your insights in to the world of farming. Both you and your mate Mr Clarkson, continue to do the sector proud. Cheers. Chris.
I fear it's land clearance for housing and solar, unfortunately, and by clearing our custodians of the countryside out of there living, whilst they can generate a tax income from the destruction of farming, they believe this is acceptable. The misunderstanding of asset value required, v/s yearly income, was so well explained. Unfortunately, above the intelligence of those that should be building a better country, not dismantling it.
Most farmers are happy to sell for housing developments AFAIk. Planning permission is the problem.
The Communists are implementing Holodomor 2.0. Unfortunately, most people don't read history books, so history will repeat itself.
Yup
Just a way to force people to sell.
@@OOpSjm Yes!
It's not above their intelligence; but they have zero interest in building a better country. In fact, they want to destroy it and they are already well on their way to doing it. They don't think like we do. They have a plan to take all small businesses into corporate ownership.
It makes me so sad that the government just don't understand what food security is and don't appreciate the people dedicating their lives for it
Fantastic video. Sums it up well. Thanks
To look at this from another point of view, are you not arguing to keep the cart before the horse in perpetuity? There has to be good reasons why farmland has been consistently sold for far more per acre, than can be justified on the basis of growing crops or livestock. Why haven't farmers been protesting for the last decade to remove land inheritance, development and speculation tax breaks, so they can be left in peace to grow crops and manage the land sustainably. I nearly bought some grade 2 arable land in 1992 for £1500 an acre, which could just about provide a purely farming return on investment. The policies that have happened since then, to create this bubble, should have been derided by the CLA , NFU etc etc at the time. The deafening silence for years , means I am now struggling to shed many tears.
Exactly. Farmers could easily choose to protest to keep farm land only for farming. This would keep down the price of farmland and avoid inheritance tax.
Farmers are complaining because they are far more concerned about keeping inherited wealth. It is all about greed.
@@Ztandard32 It is definitely about greed. They take payments from the State to do nothing on their land. Is it me or is that communism?
@@johnsmith-ls4rc it does they just don’t want to sell it and want to moan about being hard done by when in actual fact they are still taxed less than anyone else.
Working 7 days a week for pittance is about greed. Hardly.
@@Ztandard32 Afraid so farmers have been protected for years.
Thank you for educating us regarding UK situation.
You've only had half an education, there is a whole other side to this story.
A few questions if i may? What's the difference in tax situation if the land is owned by an individual, or a business?
Secondly, the gov website I looked at didn't mention machinery and livestock; are you sure that would be taxed?
Finally, slightly different question. Of the people in the UK who call them selves farmers; how many own / will inherit a farm? And how many work on a farm as an employee or contractor?
Good video. Starting to understand why farmers are angry.
Great video. Actual example numbers set out clearly - which has been lacking on all the major news channels so far. Key analysis for me is that on a typical farm facing a £1.2m inheritance tax bill but the farm earns £60k profit in a good year it would take 20 years of ALL of the farm profit to pay it off. What do the farmer and his family live on in that time? What about bad harvest years when there is a loss? What happens after 10 years when only half the inheritance tax debt has been paid off - does HMRC send in the baliffs to sell the farm. Its a ludicrous situation.
Harry, couldn’t agree more. Love both your channels. But Reeves didn’t stop at the savaging of farmers. IHT now on inherited private pensions, at 40%. That will cost my kids dearly. Public sector? Nada.
Harry kind of said it but didn’t… a lot of land is going to come onto the market. These policies are all about forcing family businesses out and allowing corporate institutions in, very likely re-purposed for building.
It’s economic engineering at its worst, forced by the hand of government and not the free market.
I think they should relook at it and make sure that the relief of Inheritance Tax for farming is genuine rather than rich people purchasing farms not really producing any quantity of food or adding to the UK food security and getting the 100% relief.
I would say there should be a quota on the Inheritance Tax based on a tier of food production. Maybe you might need to zone that based on regions of the UK so the productivity of land is accounted for. Either way there is a middle ground here that should be found.
Great presentation Harry, thankyou for explaining the situation in a way that non farmers can understand. I agree something has to happen prior to the implementation of this ridiculous scheme, personally I hope it's in the form of a general election.
It’s up to you and JC to teach her and the public etc ……what will happen etc …as You ,JC and some way Kaleb are now The Face of British farming .
Sadly it’s not just farmers, it’s pretty much every privately owned SME in the country! Not surprised, this Government has absolutely no business experience within their fold, they’re all civil servants!
Who needs business experience when you've got a self-authorised monopoly on the legal initiation of lethal violence?
@@tombley5760 On what…?
they are getting a 50% reduction. How have the Tories supported business over the past 14 years?
Most other people are angry about food banks, NHS waiting lists and crap education.
@@Xyzabc998 They had no alternative. People on PAYE are already taxed to the max. This video goes under the banner of "nice try". I think a garage full of supercars tells the story.
They want to destroy the middle class and private property ownership
So ok what has Clarkson got to do with it ? In it for the tax dodge ? So your other farm paid inheritance tax before 1984 and not paying tax has helped pay for subsequent farms !
Didn't Clarkson brag about buying his farm to avoid IHT at the start of his show?
yer and after his amazon tv show , he stayed out the country for a year , to avoid tax , then prob bought the farm with a offshore account .
I think Harry and many genuine farmers will forget that not everyone is playing the honest game. We all know there is no IHT on this, the ten fold increase in farm land is not because of the high return being a farmer is it?
@@fraserwright9482 Harry sold his previous farm for housing and bought a nice house in the Cotswolds with farm attached. Limiting his IHT and allowing him to amass a nice collection of tax efficient classic cars. Maybe not such an honest game, but I think most farmers would love to do the same if they are honest about it.
The insurance company that bought Harrys previous farm sold the land for housing. Is there something wrong with your ears?
@@fraserwright9482 They're not forgetting. Family farmers are incredibly shrewd businessmen who are able do things like... start car magazines. It's not by mistake that they're suddenly not mentioning the ability to sell equity, or that they depend on poorer contract farmers who inherit piss all. Their only flaw is forgetting how unconvincing it is to cry wolf when their other youtube channel is showing off their massive car collection.
A very clear message, thanks for sharing Harry.
Another excellent video on this serious subject. There is space, though, for a little humour, the motor sport inspired slip of the tongue at 46 seconds🙌
Well said Harry I dont know how you've kept it together a real gentleman
Great summary Harry - couldn't agree more and as a non-farmer in a rural town I would fully support any action farmers choose to take.
Glad you mentioned the idea of tapering - it IS unjust and I think totally wrong that a small number of very wealthy people can avoid tax on thousands of acres - that's not about 'politics of envy' - it's about fairness. As you say they'd probably just avoid it another way sadly, but principles matter.
For ordinary family farmers though this is devastating and, let's hope, between now and 2026 the government will come to appreciate the need for change. Keep talking!
We need to save our countryside
Well the value of farmland has shot up because of people buying it purely to avoid inheritance tax. Clarkson, Dyson and many more. This should now stop and there will be some investors getting out because this tax relief has gone. Farmland prices should drop reducing the IHT bill. There will also be opportunities for new younger farmers to enter farming as more farmland comes onto the market. Eventually farmland prices might have some relationship to what a farming business can sustain.
Rubbish . How long is "Eventually"?
What happens in the meantime while your "Eventually " plays out?
This is obviously a Starmer plant and you will be forced to recant .
Great comment, more please
Thanks Harry for this, a well considered appraisal of the Budget implications. Let’s hope government will appreciate the impact on farmers and the countryside.
Apparently the billionaires are buying farm land . Does that have anything to do with it ....?
Bill Gates visited Starmer in Downing Street last month. Gates think he knows lots about farming as he is now the largest owner of farmland in the US. Labour's policy will mean we will just end up with unsustainable megafarms owned by degenerate billionaires.
As if metropolitan London gives a stuff about anything rural, their ignorance is staggering and frightening in equal measure.
That goes both ways. I don't expect farmers are thinking about the inheritance tax on fairly ordinary houses in London that people want to pass on to their children.
They want your land!
You will own nothing.
Some still don't see it. Even Harry is looking for some other explanation. Everything according to the 2030 and 2050 agenda!
💯 land grab
don't be silly
The entire point is to force family farms onto the market to be bought by and folded into massive crony corporations
@@Xyzabc998dont be naive.
It is worth noting that in your example of a £1.2 million tax bill which can be paid by instalments over 10 years, interest is payable on the outstanding balance each year after the first anniversary. as well. So on the second instalment of £120,000, there is a further £78,000 of interest to pay, making almost £200,000.(There is no interest on the first instalment if paid on time.)
Thanks for the info as always.! Can you do a video of the tax changes to pickups!!
Another good video, all the figures laid out. 100% agree with you. Maybe it is time to hold back on supplying. I'm sure they'll get pissed off when they've had no milk for a few days..
🚜"NO FARMS, NO FOOD, NO FUTURE"🚜
Nicely put Harry.
Well done Harry, the voice of reason. I'm not a farmer but have a lot of friends who are ; this is a continuation of the old class war.
Exactly, the very very rich and very very privileged want to stay that way.
With you on this Harry.
All in how much will they actually make from this - Feck All in the bigger scheme of things.. Im not a Tory ( Scotch Irish) but what part of you grow our food is hard for Governments to comprehend !!!! Great Vid - Great Channel ever in Frankfurt beers on me !1 SLAINTE !!!
Excellent video Harry, i wish you could have 15 mins on bbc/ itv so that more people heard you !
James Dyson owning 25,000 acres purely to avoid tax is the root to this tax
According to the Sunday Times, Dyson paid around £156m in taxes in the UK last year.
and took his work abroad post Brexit
This talk in the comments about tax dodging and rich people is a story to sell this new law to the public at large. It is a side issue. Inheritance tax is a way to keep people poor, born poor, die poor. Everybody starts from zero, and the idea of a "family" is thwarted by economic means.
The farm/land has no value until it is sold, and at that point and only at that point should it be subject to tax. If Labour, or any government for that matter cannot understand that, we are in trouble.
Perhaps the banks that specialise in farming need to join the farmers to challenge this ludicrous tax change.
This is the obvious solution. No tax is due all the time the farm is active. If the kids inherit the farm and decide to sell it off for redevelopment then tax them on the proceeds of the sale.
@@chiefsilverback Solution to what? I think you missed the point of the change. It is meant to bankrupt the small farmers so they are forced to sell their land to government endorsed giant corporations. This is THE PERFECT solution.. :D
Lots of things are taxed without sale. Tax is merely a mechanism for the government to make money whilst ecouraging certain behaviours and discouraging others. Lots of reasons to disagree with the policy, but that isn't one.
Everyone else in the UK that needs to pay 40% inheritance tax at a far lower threshold than is being proposed for you (£1,500,000 - £3,000,000 before paying 20% instead of 40% over 10 years) don't matter of course...
It's okay we'll just pay to prop you up and rich people who buy farms as a tax loophole, don't worry.
@@evulclown close the loop hole. If the farm has been in continuous use for XX years, and remains in continuous use for YY years after inheritance then no tax.
As Harry points out in this video, a £5,000,000 'asset' may only turn £100,000/profit, so it would take 10 years of profit to pay off the inheritance tax, and what does the farmer live on for that decade?
If you inherit £5,000,000 in cash it's very easy to count off 20% of it and pay the tax bill, but you can't just pull 20% of the value out of working farm.
What doesn’t help is celebrity’s like JC writing articles in the past saying he’s bought a farm as his dependents wouldn’t need to pay inheritance tax on that money tied up in a form.
Harry great video, really sad to see what is happening to family farms
Yeah, this government is in thrall to big business and, dare I say, big farmer.
So if your bringing in 50-60k a year after all farm costs and prob living in a house with no mortgage your doing extremely well each month.
Not really given the massive amount of work required to get there.
@ I didn’t mention effort, lots of people work just as hard or harder for less.
Should be 100% exempt from IHT as long as the farm remains in the family. If it is sold in the following 25 years, IHT should be clawed back at the time of the sale.
But I guess if a farm is sold later or at any time it would attract Capital Gains Tax anyway on Sale so you surely couldn't have IHT and Capital Gains applied together ..
@@TT_1221 IHT is 40% and CGT will be 24%. Would be possible to charge the extra 16% in this scenario.
Define “family” …?
@@IverKnackerov Offspring, sibling, or their issue. This is the natural way of farming families staying on the 'home' farm.
Why? So the UK tax payers prop up your poorly managed nepotism with massive amounts of land and paying no tax back to a society you benefit from and live in?
Don't worry it's only 20% for farmers, the rest of the UK pays 40% so we're still propping you up.
I'm sorry that it's such a surprise. When you said the return on capital is poor, and that it's not the farmers fault that the value of the land has gone up. I think that's the point. The value of the land has gone up, mainly due to speculation about planning etc, and you're right, they aren't farming. But there's also inflation in land values due to avoidance of inheritance tax - Dyson isn't farming his land. Labour are trying to target those who own the land but don't do anything with it. It seems to me like they are hoping if dyson etc have to sell the land, but 2026 april, land values would have fallen so much that the actual inheritance tax bill would be minimal. Especially if it's net assets, and mortgage debt would count against it.
I want to go back to your poor return on capital point. Working the land makes no money. Speculating on the land does. And that is, I think, the issue. One person's land wealth is another young farmers land unaffordability. If land values drop precipitously, yes there might be fewer family farms but they could also be more farmers overall!
I wonder how you know what Dyson is doing with the land? And thinking that Dyson will pay any inheritance tax is naive in the extreme.
@@martinjagfansmith you're right, i don't know what dyson is doing with the land! i'm assuming he's not farming because as harry says, farming makes no money. and yes i agree that dyson avoiding inheritance tax is ridiculous and we need to do what we can to stop it
@@TheoneandonlyRAHhe is farming, one of the largest pea producers in the UK. It's not clear if the land is held personally, in a business, or some other way. There are a couple of recent TH-cam videos showing the farms.
Seems to be particularly interested in the technology, e.g. robotised greenhouses, technology that could eventually be commercialised.
I personally find it quite interesting as I live somewhere (Kenya) with inconsistent rainfall that has a big impact on crop yields. Greenhouse farming is already quite big, but automation is low because there is little competition for labour and therefore wages are low.
@@russellpengilley5924 yep kenya is full of greenhouses isnt it? a big centre for flowers and green veg iirc? glad to hear dyson is farming. still think iht has a chance of being net positive for farmers in general, but glad to see he's innovating in the field
@@TheoneandonlyRAH yes, flowers and higher value vegetables like green beans, sugar snap peas and baby corn. The cool chain logistics setup is quite impressive.
Thanks for the update Harry.. Im surprised you kept such a cool head doing this video.
This tax relief introduced in the 70s to help family farms was broadened to shares in other businesses like Self-storage, leasing...there are loads. That allowed the development of investment funds which invest in them, and then savers, you or me, can buy shares in the fund, and these shares can be passed on IHT free. This may be one factor that caused land prices to spike more than farm profitability justifies. The relief could be restricted to the testator, and pethaps beneficiary, working full time in the business being passed on.
Blame your chums James Dyson and Jeremy Clarkson, and others of their ilk, who bought vast acresges purely as a tax fiddle.
According to the Sunday Times, James Dyson paid £156m in taxes in the UK last year. All this is going to force small family farmers out of business while Starmer's new friend Bill Gates starts buying up land. He's already the largest owner of farmland in the United States.
And, as usual, the Labour party has a knee jerk reaction that has a major detrimental impact on all but the ones they're supposedly targeting. Remember IR35 to catch Greg Dyke? Massive impact on the freelance workforce who have been progressively forced into inflexible permanent employment, just the thing to increase growth. Or is it?
We need to fix this pronto.
You think that isn't the plan from the government for the land to end up in the wrong hands
I feel for the farmers and their families who now suffer at the hands of Labour incompetence. Glad you are calling out this BS Harry!
Harry you are such a details man who brings a lot of attention to farming via people like me who found you via Evo and your car channel.
There are some real challenges around food production, food security and the sustainability of farming in the UK. This plus Brexit and the change in subsided payments seems to be a huge issue, my question is where are we at in terms of level of crisis , is this as big/bad as foot and mouth etc.
Total disgrace and theft
And all this happened just after a visit from Bill Biggest Landowner in the US Gates.....imagine my surprise
Waiting in the wings to snap up Uk land next, owned offshore with no inheritance tax issue.
💯
US influence in the UK is getting egregious in the extreme now. They are the worst societal mentor you could pick outside of the obvious ones. Instead of high profile Americans “advising” we should be looking to places like Scandinavia, the Netherlands. They get far more things right (not everything obviously) than our “cousin” across the pond.
BG is evil personified. He also thinks he’s the fount of knowledge on medical issues as well what a prat.
Very succinctly put Harry. Loved how you didn’t talk specifically about your situation as well that was a nice touch. It’s a bad situation that hopefully as the dust settles gets tweaked.
It was a pleasure to meet you yesterday evening. Thanks for chatting to me about cars and roads.
To be clear, I don't disagree with his concerns but, to be honest, it would be tricky for a guy with a multi-million pound car collection to talk about 'scratching around to make a living'
@@Stu_2112 He has worked and taken financial risks for nearly 40 years to have what he now owns and enjoys with the rest of us.
Yes he makes money from TH-cam but so do the BBC Sky etc.
Get a grip!!
@@Stu_2112 it's much different, because the car collection is purely recreational. Machinery is a necessity to do the job with farming.
Morning Harry watched this video last week .
Brilliant, the passion for farming really comes through. Unfortunately, this is another government that's he'll bent on ruining another one of this country's industries. There used to be a thriving international haulage industry in this country that's gone. The London taxi driver industry is gone, and they keep talking about growth embarrassing
I stand with the Farmers
Hi Harry. If, as they state, Labour’s primary reason for scrapping the 100% IHT for farmers is to capture those non-farmers who have invested heavily in land as a way of avoiding IHT - giving them a generational tax shelter for their wealth - then why do they not amend the rules and grant 100% relief to those farmers who are farmers; by using the same eligibility criteria as would be used for a tenant farmer who wants to pass on his generational tenancy to the next generation? This would mean that only those farmers whose principal source of income (at least 50%) was earnt from farming the land out of at least 5 of the last 7 years prior to their death. As many land investors, such as James Dyson, Jeremy Clarkson, pension funds and so on, would not qualify under this criteria, they would not get IHT relief and so achieve Labour’s stated aims. Whereas the family generational farmer whose principal source of income is the farm, would. Would you be willing, Harry with the influence and platform that you have, to raise this key point with Labour and so take the focus off the £1m limit and onto what the stated purpose of the change is for? How could they argue with using the succession clause which is already written in law for tenant farmers who pass on their tenanted farms, when it would effectively sift out the ‘wheat’ from the ‘chaff’ by bringing to light who was a farmer who depended on their income from the land (the ‘wheat’) and who was not (the ‘chaff’)? With best wishes
Wouldn't matter anyway, because they'll engage in pseudo farming activities so they barely qualify as being active farmers under the law.
I had similar thoughts, so many different ways they could go around it really if that was their goal.
I think though that one of the reasons values have shot up recently though is because the likes of James Dyson and your neighbours have been buying up agricultural land solely to benefit from relief. This measure may lead to a significant reduction in land values, reducing the IHT issue and also giving young farmers the opportunity to get into the industry without taking on stratospheric levels of debt
If y’all were in a non-farm biz and your family owned the biz, the transfer of the ownership, between family generations, wouldn’t that transfer require inheritance tax?
@@Padoinky no, not before if the kids worked in the business. Now any family business will need to pay IHT on the business asset. There will be no family firms left just big corporations
yes, the exemption is only for farming
why shouldn’t the farmers pay everyone else has too and if i’m not mistaken didn’t you take the last governments offer to not farm and plant “wild flowers” for birds because of the money ?
@@MrAndyS you are wrong, a corporate business does not PAY IHT. That is why family firms (not just farmers) do not pay IHT when passed to a family member in the same business.
@@ccooper8785 no its not.
Since WW2 the return on owned farmland has been around 1.5% pa. Before then it was worse. Right now income support for farming has effectively been removed and market prices are not shifting so farm incomes must fall. Economy of scale works in farming, and debt doesn't. Banks will be very very cautious. I agree with Harry....watch this space. Either the government backtracks or we are looking at the start of a skewed farmland nationalisation.
Great? Farms should be in the hands of whoever creates the most food, for the least environmental damage. And farm size dropping and land values dropping is necessary to allow new farmers in.
@@louisholden5127 There is a pretty strong argument that the state should own the land. The whole idea that someone like Dyson can buy up huge tracts then lease it to tenant farmers is obscene. We are paying for that as subsidies to farmers will end up in these landlords pockets.
Great informative video, the shocking reality of farming let’s hope they listen.
Harry, very well explained. As you mentioned it is hobby farmers who use the farm as a tax wrapper to protect their wealth. They do just enough to be seen as a farmer
People are taxed to death in this country, just the way it is unfortunately. Also, on a slightly less relevant side note, King Charles paid zero inheritance tax, but everyone else still has to pay it, seems kind of unfair, doesn't it?
And don’t forget The Westminster and his mates pay no tax
That’s the difference between royalty and subjects
@@ruststar Before the Normans, British monarchs were no more and no less than the first among equals. It's now time for the royal privileges, which are hangover from Norman/feudal times, to be abolished. Royalty should pay tax like everybody else. The Duchies of Cornwall and Lancaster should be transferred back into The Crown Estate.
It's Called Debt Slavery to The Uk Corporation City of London....... Anyone who has a Birth Certificate is required as traded chattle to Make 'The System Money' !
I also heard that Indians residing in the U.K. are exempted…go figure!
So farmers and land owners who educate their children at private schools have been really shafted.
@@Billywoo12 probably 90% of both groups them vote Tory so no political damage to Labour
How many ?
What a cozy dairy barn you show in this VLOG. My family's farm in the United States had to grow to thousands of acres of cropland before the income stream allowed the transition away from dairy operations. At that point, some years ago, 700 cows were being milked using highly automated milking stations. The alternative was to employ a team of immigrants and to teach them how to milk. Waste treatment was also an issue and a cost.
Very well put and explained harry. you have explained this new 20% inheritance gift from labour very well. Typical labour tax and more tax and clobber anybody who lives and works in the country side.
A big focus on farming but a small focus on the 40% tax on pensions in 2027 which will have a bigger impact on many more people.
Can you explain what you mean by 40% tax on pensions? Right now, if you earn over 50k in your pension, you pay 40% on whatever is over 50k. This seems pretty fair as someone able to fund a 50k+ pension was probably getting the higher rate tax relief on some of their contributions.
You seem to have a problem in understanding that this is a farming channel. Congratulations!
@@JohnnyMotel99 My limited understanding is that you could leave any unused defined-contribution (money-purchase) pension to your children without paying inheritance tax - until Rachel Reeve’s budget removed this loophole.
@@brianforrester7707 my misunderstanding then, don’t really follow the budget.