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Agricultural and Farming Accountants

As farming accountants, we know only too well that agriculture is an industry challenged by fluctuations in the economy and buffeted by changes in government agricultural policy.

That means it's vital for farmers to maintain a strong grip on their cashflow situation, stay on top of bookkeeping and seize every opportunity to save on tax.

Accounting for agricultural activities

That so many farms are family businesses adds further complexity. We offer tax advice that takes this into account, from succession planning and inheritance issues to tax efficient agricultural business structures. Understanding the difference between jointly-owned property and partnership property arrangements, for example, is vital.

For many farmers, finance can also be an obstacle in expanding or diversifying the business. As part of our package of corporate finance services, we can support you in identifying and approaching investors and lenders with an interest in agriculture.

To find out how we can help your farm business flourish and grow, please contact us for a free one-to-one consultation with an expert agriculture accountant.

Accounting for agricultural assets

For most farmers, the single most important and valuable asset is the land itself. It's also a long-term asset, typically staying in the same farming families for decades or even centuries.

Valuing the land is one thing and accounting for the costs of its maintenance, from fertiliser to drainage schemes, is another. Knowing what can and cannot be claimed requires considerable experience and expertise.

There are valuable tax reliefs available for farm plant and machinery, such as bulk tanks, tractors, trailers and combine harvesters. Understanding how capital allowances apply to agricultural equipment can make a vital difference in decisions to invest or upgrade equipment.

There is considerable complexity, too, around capital allowances for farm buildings, but certain functional fixtures and fittings might also be eligible for capital allowances, such as milking equipment.

Increasingly, agricultural accounting is also about understanding the wider context of the rural property market. Whether it's advising on capital gains tax on the sale of farm buildings or understanding the tax implications of converting cottages or outbuildings for use as furnished holiday lets, Andrews and Palmer can help.

In recent years farmland has also become attractive to those from outside farming looking for tangible items in which to invest. That's especially acute with a trend towards the relaxing of planning permission which makes it more likely they'll be able to build a home, or homes, on that land in the future.

Accounting for livestock

Another important role for accountants in the farming sector is valuation of farm stock, from crops to livestock.

HMRC expects farm stock valuations to include costs that can be directly attributed to the production of rearing of stock as well as a reasonable proportion of indirect costs.

As always with the calculation of indirect costs, there's no hard and fast rule – sensible judgement based on sound calculations, carefully documented in case HMRC asks to see the workings, is the only workable approach.

Direct costs might include the fees for cattle insemination, vet's fees including prescribed medication, the cost of dehorning, and so on. Indirect costs could include things like rent and rates, or staff costs where someone working for you spends only a certain amount of their time working with livestock.

Next steps

Contact us for a free initial assessment of your farm's accounting needs.

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