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Grazing licences change

claCLA CYMRU warns that only landowners or tenants will be able to claim Basic Payment payments under the new payment scheme With the new Basic Payment Scheme (BPS) coming into effect from next month, (1 Jan 2015) land owners, managers and farmers need to check their agreements. “Under the new rules, only owner occupied land farmed in hand, land held under an Agricultural Holdings Act (AHA) agreement or a Farm Business Tenancies (FBT), will qualify for a BPS claim from 1 January 2015,” says Chartered surveyor for CLA Cymru Charles de Winton.

“The new rules do not allow a grazier who is taking a crop of grass currently covered by a Grazing Licence or Profit of Pasturage to make a claim for the new entitlements,” he says, adding that under these changes the Welsh Government has provided clarity on which party may qualify for payments from the new scheme. “Members with existing arrangements where graziers currently claim payment- known as the Single Payment Scheme (SPS)- by way of a licence or Profit of Pasturage agreement will no longer be able to do so.”

“From January 1 2015 graziers must have an FBT in order to claim,” says Mr de Winton, who explains that this will give the grazier tenancy status and exclusive occupation of the land which will supersede all existing grazing or profit of pasturage agreements,” he adds. But he warns that there may be Inheritance Tax implications on the landowner where reliance has been placed on grazing licences by the landowner. “Not all cases are the same so advice is strongly recommended if the landowner is in any doubt,” adds Mr de Winton. “We urge members to talk with their graziers/tenants about moving to an FBT as soon as possible to secure current payments which could be threatened.”