Single Farm Payment - June 2005
Now that the Single Payment application process has been completed it is time to consider the effect this new payment will have on your annual accounts.
The first payment is not expected until the first half of 2006 and so for most businesses there will be no subsidies received for a period of at least 1 year. The Single Payment scheme is based on a calendar year but no payment will be brought into the annual accounts until the 10 month rule for occupation of land has been satisfied. This is in accordance with accounting standards relating to government grants whereby income is not recognised until all conditions for eligibility have been satisfied.
It must be noted that the tax treatment of the Single Payment has yet to be announced and although we would hope that this would follow the accounting treatment, it cannot be taken for granted.
As a result of the above, the forthcoming accounting periods may be a little unusual and may give you extra room for sensible tax planning measures which we will be sure to identify with you.
Environmental Stewardship Scheme – update
The application process for this scheme is now well underway. Applications to the scheme may be made on a 3 month rolling basis – no final deadline has been determined and the scheme should continue to accept applications until the funds dry up.
For additional information you should, in the first instance, contact the Rural Development Service to request an application form which will be sent out together with a handbook for the scheme identifying the different management measures which you can select from when making your application. In addition, there are details, guidance and application forms available on the DEFRA website.
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