Red tape makes farmers green around the gills
TAX doesn’t have to be taxing – or so the old advert would have you believe. But, as I discovered the other day, this might be about to change.
Coincidentally, it was just a day or two after I’d made my annual trip to the accountant to, as I like to put it, sort out my tax affairs (or, as he likes to put it, deliver a shoe-box full of the farm’s receipts and invoices for him to sort out) that I heard that the whole job will all soon have to be done online.
Not only that, but the self-employed will have to file returns quarterly, rather than once a year, as is the case at the moment.
Now I know that the current system means there’s always a last-minute rush to get things sorted out by January to avoid fines, but the prospect of having to do this every three months has filled farmers with horror.
Even scarier, HMRC wants to bring this new system in by 2018!
Part of the problems is, of course, that we farmers want to spend at as much of our time as we can actually looking after our animals and tending to our crops – but filing returns on a quarterly basis would take up more time, while making absolutely no sense for our industry.
The Government’s plan is to allow both the person filing the returns and HMRC to have an idea as to what tax will be due at the end of the year, a wee bit in advance.
And that might actually be useful for some businesses where income is spread across the whole year.
However, farming income tends to come in lumps – grain farmers tend to get just about all their income in a couple of months after harvest, sheep farmers tend to sell the majority of their stock over a few weeks or months and, for some who sell their cattle through the market, the returns for a whole year’s work can be decided in the few minutes it takes their stock to run through the auction ring.
Even dairy farmers, who tend to get a regular milk cheque every few weeks, would argue this has been so low it has hardly been worth counting.
And there are loads of special tax rules and regulations in the farming world which don’t fit into this off-the-peg solution for all businesses.
On top of all that the internet service tends to be either poor or non-existent in rural areas.
So, for farmers, it sounds like tax is definitely going to get a lot more taxing in the future.