8 replies to this topic

[paully]

Hi
How often do you need to prove profitability in order to be able to legally build a residential dwelling?. I assume  it is one-off evidence...of sufficient potential that the farm has onging viability?

And what level of income would be required?.....I have both of your books but cant recall whether you are explcit about the level of income needed to show you have a viable business.

Hypothetically (and with no suggestions that forum members consider bending the rules) - would it be possible to have legal and audited accounts drawn up which show the neccessary income / profitability during the 5 year period....by selling (some of) your produce to a friend or relative (at an inflated price). Who would know otherwise, unless someone stood by your shop till for 5 years...alwasy assuming that the profitability you claim is actually realistic (ie not claiming income of �50k a year off 1 acre)?

Once the permission has been granted - can it then be withdrawn? Does anyone check up whether the farm continues to be "profitable".Or could I then continue to operate it as a business, but not worry so much about the level of profit, if my income is subsidised by unearned income (eg my Pension).

The reason for asking is to try and quickly satisfy the planning conditions , rather than worry about generating "real" profitability for 5 years or more. It obviously needs access to some ongoing cash-flow for a few years, but the problem of paying tax twice on some money should be quite modest - unless you are already skint. My idea is not to become a "gentleman farmer" - but I admit to wanting a life-style smallholding rather than something which absolutely has to provide me with a living. Is that sacrelige on this forum?

[admin]

Hi Paully,

You'll need to complete the tests only once. The level of income is minimum wage for one out of a given three year period. That's approximately �20k in real terms for one of those years.

To pass the tests you will need to have a credible agricultural business. That's the simplest advice that can be given, whether you want to do creative accounting is up to you - it's a business like any other and you stand a realistic risk of getting found it.

I think there are probably a lot of people out there who want to live in the countryside and not really have to change their lifestyle. Those are exactly the people that the current planning laws are attempting to stop (unfortunately they are also doing a good job of stopping those who want to run an agricultural business too!). The system described in Field to Farm isn't really about getting everyone their own mansion, it's more about providing people with the opportunity to live the dream ie. changing their life so that they get the opportunity to live on their own land. Prior to the book this was a massive undertaking and it would seldom work because the planners would stop you at the first opportunity. People now have the chance to make that leap into living off the land and escape from the ratrace.

Unfortunately to really make this work I think you'll need to commit to some hard work to make the business financially viable for the first few years. Minimum wage 1 out of 3 years isn't out of reach if done properly but the level of effort shouldn't be underestimated. Real Smallholding should give you the information about likely returns and levels of effort.

So far we don't really have any agricultural zealots on this forum Everyone is just looking to get by and get help with the planners and their life.

Thanks,

Steve

[paully]

Thanks for a prompt reply Steve

Just to be clear - I understand and appreciate the amount of hard work involved. But I am more interested in self sufficiency - in terms of produce and of some income - than I am about becoming a stereo-typical farmer who constantly worries about the weather and the price of lambs.

Im not wealthy by any stretch, and am likely to become much poorer as the divorce settlement is finalised - but through some creative accouting could show a paper profit over 3 years even if the reality is a bit different. But I certainly dont have the money to go out and purchase a working farm - or even a registered smallholding.

Im not interested in building a mansion - I have a largish house already and actually wnat to downsize. A modest cottage surrounded by land, with the chance to grow and eat my own food and to sell some surplus would do me fine. I see the ideas in F2F as a way of achievin gthat - and "sticking it to the man", as my teenage son might say.

Whilst Im sure that many smallholders do struggle financially, I dont think we need to automatically equate smallholding with tractors and trousers held together with baling twine......also perhaps a stereotype which doesnt match the reality. I suspect tthat most forum members want a modest lifestyle, free from some of the usual shackles and able to take more control over what they do and when.  I doubt if there are many who's lifes ambition is to rear pigs or sheep (rare breeds perhaps) or grow potatoes, to be utterley dependant on the weather or on the great british public to buy their carrots - it is a means to an end. (With apologies and respect to any pig, sheep or potato fans who do have such an ambition - good luck to you )

It seems to me that the very nature of a smallholder is someone who has created a lifestyle business - no one ever makes more than the basic wage presumably. But modest needs allow you to live on modest income.....thats the exciting prospect we all yearn for isnt it?


Im just looking at opportunities to shortcircuit that ambition a bit - and create stability a bit quicker . But I dont doubt or underestimate the challenge.

[surreydodger]

Hi Paully,

In addition to Dave and Steve's posts above, it really does come down to 'going fot it' fully or not atall.

I appreciate the idea to live on your land and not have to worry to much about making a full time living from it and if one is fortunate enough to have other income sources, it certainly sounds idyllic. However, looking after a smallholding runs up costs at the drop of a hat with just general maintenance of keeping fences and pasture in good order. Left neglected and your asset will depreciate!!

My own feeling is that too many folk go into small holding with a romantic idea of a simple lifestyle and easy living. There are also a lot who think raising a few animals or crops will suffice. It won't, putting it blankly though without wishing to sound abrupt. I believe you have to be entrepreneurial, imaginative, a good salesman, prepared to graft (though I seek to work without killing myself ) and have a good idea of my future market/targets. It's no use just growing carrots and selling them at a farmers market or producing some great animals to send off to the abatoir. The larger famers already do that and it is nigh impossible to compete with them on small scale.

What a smallholder can do that a large farmer can't (or not very easily) is to take ones produce to a secondary stage. I will be selling eggs (duck and hens) but they won't just be eggs in an eggbox. We wll be doing things with our eggs which add value and will produce a commercial profit for the amount we can turnover. You mention rare breeds and I accept your views on breeding values, yet there are rare breeds out there which can provide in ways commercial strains can not. Its a case of sitting down and sifting through hours of reading to find what can be achieved by what.

In a nutshell, small holding is not being a farmer (in the accepted view) but being a business standing on its own merits. I wish you luck with your dream and believe everyone should live there wishes. However, it has to be given due consideration ( a little imaginitive accounting here and there I accept ) and built on achieveable goals rather than pie in the sky hopes.

[Burl]

Hello all
We are just starting our second year for Agricultural tie of 3 years,this is the year we will hope to demonstrate profitability.
I am interested in how much money that would equate too. I understood it to be the minimal agricultural wage for one person.�20,000 is a bit steep if I am correct. We could do it but I would rather it less!!! as a safety net.
We breed and Walk Alpacas as a buisness and its seasonal but with a good summer all will be well.

[Groundhog]

Hi
This figure of 20k per year where does this come from,Agricultural Wages board standard rate is �5.80per hour which works out at roughly 12k a year,so after tax and nat ins approx 9k.If you were self employed as you would be running your own small holding and worked contracting your labour out to another agric enterprize surely you would only have to show an income of 9k after tax,by the time expenses for the small holding were deducted you would be paying marginal tax anyway.So if you were fortunate to be able to get 17hours work at �10 per hour self employed per week, would you not be reaching the targets required ?
love to hear others thoughts
Derek

[admin]

Sorry, I have no idea why I wrote �20k. It's closer to �10k as Derek says (approx �11,310 gross per year).

[Burl]

Thank goodness,we will make that no problem, after all the grief we have been through I cant wait to be "free "I hope the district council dont keep butting in after we have achieved the tests