Taxation

The CLA Taxation Department is concerned with all aspects of national taxation that affect land transactions conducted in England & Wales.

Other CLA Taxation articles

• Consultation responses
• Policy reports
• Advisory handbooks
• Guidance notes

The CLA Taxation Department is primarily concerned with the following taxes:

Inheritance Tax (IHT):
This taxes estates on death and lifetime gifts made within 7 years of death. Certain other gifts – known as gifts made with a reservation of benefit - made after 18th March 1986 are also caught even where made more than 7 years before death. Some very valuable reliefs are available, principally for agricultural and business property.

Capital Gains Tax:
This taxes gains arising on the disposal of assets (which may be made by way of sale or gift). There are exemptions (eg, for main residences) as well as for certain disposals involving businesses and business assets, including shares in family companies (entrepreneurs’ relief) as well as reliefs that defer the tax on gifts (hold-over reliefs) or where proceeds are reinvested (roll-over reliefs).

Income Tax:
This taxes all forms of income.  The CLA’s primary concern is how it taxes income from land (eg, property income) or income derived from activities conducted on the land (eg, farming) and the boundary between the two.

Value Added Tax:
Unlike other taxes many of the concepts of VAT are grounded in European concepts. This makes the application of VAT to land transactions particularly complex as European land concepts can be very different to those used in England & Wales.

Stamp Duty Land Tax:
This tax replaced most Stamp Duty levies in 2003 and 2004. It has increased compliance burdens on landowners as it is a highly complex tax on land transactions.

Pre-owned assets:
Although an income tax charge, the scope of the provisions are largely based on inheritance tax concepts and they may rightly be viewed as a separate tax. The charge is principally aimed at defeating various inheritance tax avoidance schemes, but, unfortunately, may also capture more innocent transactions.

The Free CLA Tax Advisory Service

CLA members and their professional advisers may access this service on specific questions arising directly out of their CLA-registered landownership where the land is situated in England and Wales.

Professional and Business members may also access this service in respect of general enquiries concerning land based transactions in England and Wales - for fact specific enquiries concerning clients, the client needs to be a CLA member in order to access the service.

Although simple questions may be raised by telephone 020 7235 0511 or by e-mail to debra.daniels@cla.org.uk , proper advice will often depend upon our advisers having a detailed summary of the facts and this is best provided by letter. Advice in writing will only be given where the enquiry is made in writing.

Useful Links:

Guide to VAT for shoots
Working in conjunction with HMRC, the CLA and other fieldsports organisations, BASC has produced a guide to VAT for shoots the text of which has been approved by HMRC.
Go to BASC website to download guide

Taxation - Consultation responses

Use of Rebated Fuel for Gritting in Rural Areas
The CLA has responded to the 12th July 2012 HM Revenue and Customs consultation that explores extending the use of rebated fuel for gritting in rural areas.  In its response, the CLA has welcomed the proposed extension and suggested other possible...
[1 October 2012]

Delivering a Cap on Income Tax Relief
The CLA has responded to the July 2012 consultation that explores the mechanism, first announced by the Chancellor in his March 2012 Budget to introduce a cap on unlimited income tax reliefs.  In its response, the CLA has suggested the proposals for...
[26 September 2012]

General Anti-Abuse Rule (GAAR)
The CLA has responded to the 12th June 2012 consultation that explores proposals to introduce a general anti-abuse rule to counter perceived unacceptable tax avoidance.  In its response (which is limited to how such a rule would work within...
[5 September 2012]

More taxation consultation responses

Taxation - Policy reports

Reform to perform - simplify taxes for small business units to increase enterprise
The contribution from rural areas to the nation - a quarter of UK population, 30% of its employment and economic output, and 80% of its land area - shows that the success of the countryside matters. Following the foot and mouth outbreak of 2001...
[19 December 2002]

Taxation - Advisory handbooks

CLA58 - Succession planning for farmers and landowners
This handbook will help farmers and landowners to decide whether to and how to pass the farm on to the next generation. The timely handover of a farm from one generation to the next is important from a productivity standpoint and for the wellbeing of...
[9 November 2010]

Taxation - Guidance notes

GN20-11 Notes on IHT Agricultural Property Relief for farmhouses
This Guidance Note is a layman's guide to what conditions have to be satisfied to gain inheritance tax agricultural property relief on farmhouses, including a number of common problems frequently seen by the CLA's tax department when dealing with...
[18 September 2011]

GN09-11 Capital Gains Tax: average land values in 1982
Many members will need a handy reference to land values on or around April 1982 to help with tax planning.  While this guidance note provides that, it is particularly important to note that this guidance note carries no weight in discussions with...
[10 June 2011]

GN46-03: Cowboy rating advisers
CLA warns of 'Cowboys' offering rating advice
[28 November 2003]

More taxation guidance notes