Readers may not be aware, but the Farming & Rural Business Community advisory group is on the circulation list for consultations on which ICAEW may wish to contribute a view, and occasionally we add items to that list (such as DEFRA consultations) which do not always get picked up through the usual channels.
Unsurprisingly, ICAEW has replied in some detail to the consultations coming out of the 2024 Budget announcements. The full responses can be found here:
- Draft Finance Bill 2025/26 legislation: reforms to agricultural and business property reliefs
- Reforming inheritance tax – unused pension funds and death benefits
Whilst on the subject of consultations, the group is currently represented on the working group which is discussing the taxation implications on ecosystem service markets following the wider consultations last year. Whilst the detailed decisions from HMRC are still awaited (and the exact content of the discussions is confidential), it is clear that Biodiversity Net Gain receipts will be regarded as being income for tax purposes and, in almost all cases, the same is likely to apply to Nutrient Neutrality contracts (which may be not quite what some observers are expecting). More detail is likely to come out after the Budget, but it is not anticipated that there will be changes to legislation, with recommended practice being published within HMRC business manuals.
The potentially contentious issue of recognition has not been directly addressed, remaining “an accountancy matter.”
*the views expressed are the author's and not ICAEW's