Extended tax averaging for farmers
Under new rules that come into force today (6th April 2016), farmers will be able to average their profits for Income Tax purposes from two years to five years.
The move is aimed at helping farmers with fluctuating profits manage risk and the impact of global volatility, now an inherent feature of the agricultural industry.
Chancellor of the Exchequer, George Osborne, comments: “Today’s reforms will provide farmers with additional security to plan and invest for the future, allowing them to spread profits over a longer period of time. Over 29,000 farmers can benefit from the changes, saving an average of £950 a year.
“As well as having the new option to average tax over five years, farmers will also retain the choice to average profits over two years.”