“Most people don’t take advantage of their full tax free allowance,” says Simon Cole, Chartered Financial Planner at Old Mill Financial Services, “and by not using our full allowance we are in effect, giving money back to the taxman.”

“The current allowance is £7,200, up to £3,600 of which can be put into a Cash ISA; the rest - or the entire amount if you wish - can be invested into a Stocks and Shares ISA.

“And, although interest rates are very low at the moment, doesn’t mean its not good financial sense to invest in an ISA.

“In fact, given the level of Government borrowing at the moment, the likelihood is that tax will go up as the treasury needs to create revenue through tax.  A way that the individual investor can do something to avoid some of these rises is by making use of any tax breaks they can.”

And, says Mr Cole, ISAs should be at the top of the list for this tax year, and using your new allowance from 6th April onwards – up to £14,400 sheltered from tax in a matter of weeks.

“ISAs offer tax breaks for both higher and basic rate tax payers because you pay no capital gains tax, and no additional income tax making it one of the most tax-efficient ways to save and invest.”

And for those who have already used their allowance but are not happy with the returns they are receiving, transferring your existing ISAs to another ISA fund manager at any time is possible if you are not happy with your current deal.

“Cash ISA rates are not great at the moment,” he said, “and although you can transfer your Cash ISA to another, better paying Cash ISA, it is worth taking a look to see if it is worth transferring your cash into a Stocks and Shares ISA instead.

“When rates are high, you can get fairly good income and growth from a Cash ISA with little or no risk, but now, it is hard to get the same returns unless you are prepared to take on a little more risk.”

Although Stocks and Shares ISAs do have more risk, they also offer the potential for higher returns over the long term, and now, with stock markets so low, it could be a good time to invest, advises Mr Cole.

“It is also possible to make regular investment contributions; when the markets are falling, you buy more with your payment each month which means that when the market rises again, you can really gain, and of course, the profits you make are completely tax free.”

To find out more about making the most of your tax free allowance, contact Simon Cole at Old Mill Financial Services on 01935 709364 or by emailing simon.cole@oldmillgroup.co.uk or visit www.oldmillgroup.co.uk

The firm, which has branches in Shepton Mallet, Yeovil, Exeter and Devizes realises that owner managed companies need to know that they are getting a personal service from their accountant.

“All too often, local, owner managed businesses don’t receive the personal service that they should; at Old Mill, I feel we have a unique offering,” said Chris Bowles, who has recently been promoted to Director of business services.

“Not only do we know the local area, but we have a number of in-house specialists that can offer each client a tailored, personal service, and I feel that the sort of service we can offer is particularly important when times are tough, like they are now,” he said.

As well as promoting Chris with the aim of strengthening the firm’s offering to local business, Old Mill has also appointed Jake Jukes, who until moving to the business services team, worked with Bath-based Moore Stephens Chartered Accountants.

Jake says he joined Old Mill because he shares the firm’s values and beliefs; “I really like the way that at Old Mill, clients are given a very pro-active forward thinking value added service where their needs are always put first,” he explains, ” and feel one of the firm’s strengths is a desire to deliver as promised, offering an inter-personal service that guarantees clients always have a point of contact should they need it.

“And with news this week that one in every 56 businesses is expected to fail in 2009* it is more important than ever that our local businesses are given the support they need to see them through these tough financial times.”

“Traditionally, agriculture has fared better during economic downturns than other sectors,” says Partner Ian Sharpe. “Although some farmers may find it difficult to secure credit, the industry as a whole looks set to ride out the economic storm. Many farming businesses are backed by property assets, and despite the drop in house prices, the market for land and farms remains strong.”

Naturally, there are threats – most farms now rely on some form of diversification, which may be more likely to be affected by the downturn, he adds. “Anyone with holiday cottages could face an uncertain year – but with more people holidaying in the UK, farm tourism and accommodation could actually stand to benefit.”

Farm shops could potentially suffer from decreased spending on food and drink, although demand for local produce remains strong, says Mr Sharpe.

The most vulnerable sector is likely to be industrial units and office lets. “The number of businesses going into administration has soared, so landlords must be aware of potential problems with their tenants. Not only could they be left with rent owing, they may struggle to rent out units after they have been vacated.” Landlords left with empty commercial properties will also be liable for full business rates, so should take advice on how to keep such expenses to a minimum, he adds.

The first step to recession-proof a business, and even take advantage of the new economic climate, is to assess cash flow requirements, says Mr Sharpe. “Most businesses do not fail due to a lack of profits, but because they run out of cash. Prepare a budget and if you are likely to need more borrowings, give your bank as much warning as possible.”

Farmers should also keep on top of money owing and chase up debtors regularly, he adds. “In addition, stay up to date on your own payments, so that you do not suffer unnecessary interest or late payment charges.”

With the Bank of England base rate falling to 0.5%, the cost of borrowing has dropped sharply, making now a good time to invest for the future. “Many builders and contractors are struggling to secure work, so farmers have the perfect opportunity to carry out repairs at competitive rates,” says Mr Sharpe. “Now may also be a good time to consider fixing loans at current interest rates, to reduce risk in these volatile markets.”

The weaker Pound against the Euro is also hugely beneficial, boosting the value of the single farm payment by around 20%. “It is possible to lock into this favourable exchange rate by taking out a Euro loan from your bank. This not only removes the risk of future currency fluctuation, it could significantly boost farm incomes,” he adds.

“While no sector is entirely sheltered from the economic downturn, farmers who protect against risks and take advantage of opportunities are most likely to weather the storm and strengthen their business for the future.”

Many landowners have erected farm buildings and then let them out, changing their use from VAT-rated to VAT exempt. “If you claimed the VAT back on the building work, and then change the use from agricultural to a commercial let, you could end up having to repay the VAT,” says Mark Peters, director of Old Mill’s VAT consultancy.

With HM Revenue & Customs targeting this area for inspection, farmers could end up having to pay back thousands of pounds in tax, he adds.

Problems typically arise when farmers change the use of a new property before fulfilling their original intentions, hence altering the VAT situation. So if a building was intended for agricultural use, but was let out before being used for the farm, the landowner could have to repay the VAT on the build. “One solution might be to elect to charge VAT on the rental income,” says Mr Peters.

But if the owner actually satisfied the original agricultural use they could safely change the use without incurring a VAT liability, he adds. “However, if HMRC believes there was always an intention to use it for dual purposes, then they would argue that a only a proportion of VAT should have been claimed initially.”

Adjustments can also arise even when the intended use has been carried out, if the expenditure involved is significant, warns Mr Peters. “In some circumstances the use of a property must be monitored for 10 years, with any changes in the original level of taxable business resulting in a VAT adjustment.”

Of course, the regulations could also work in landowners’ favour. Anyone building a residential property intended for a VAT-exempt long let, who instead puts it to use as holiday accommodation, could make a belated claim to recover the VAT paid on the build, for example.

“However, every situation is different, and with HMRC paying closer attention to this area, anyone planning to change the use of a building should seek professional advice.”

The seminar, entitled “You, your car, company cars and tax” looked at a wide variety of topical issues relating to cars and the related taxation – both subjects close to many business peoples hearts.

Craig Howes and Mark Peters, Directors at Old Mill, spoke about the key issues surrounding the changes to company car tax. This is now calculated solely on cars CO2 emissions -  and it is now very important to consider the emission band the car sits in when buying a new car.

Craig and Mark, also talked about the Government’s change to the tax regime to abolish the writing down of balancing allowance for cars over £12,000. This significantly extends the time it takes to get tax back after the car has been sold – and for high emission cars this could now take 20 years. This means that people should seriously consider the tax advantages of leasing. Leasing tax rules are much simpler than for owned cars and all costs involved are claimable against tax, so leasing, said Old Mill, could be the way to go.

Tony Grice, Sales Development Manager for Volvo talked about corporate manslaughter and the fact that from April this year, if employees are involved in a fatal car accident whilst on business – even if they are driving their own private car, their employers could end up in court facing charges of causing death by negligence. It is the responsibility of employers to ensure any vehicles used by employees on business are fit for the purpose. This is causing companies who have ceased providing company cars to reconsider their position.

He highlighted the importance of car safety and the wellbeing of employees using thought provoking images and videos to show which cars are the safest to drive.

Craig Howes comments “This was a different type of seminar looking at a very different topic. However the response of the businesses that attended was very positive. It bought to their attention important matters which they may well have overlooked.

Anyone who would like more information about any of the issues raised should contact Craig on 01935 426181.

Old Mill’s Martin Taylor presents 1st prize to Thomas Hunt (left) and Michael Berside (right) for Thomas Hunt’s  pair of Exmoor Horns. Thomas and Michael are both ‘A’ level students from Bideford in North Devon. Thomas has 30 Exmoor Horn ewes and was delighted to pick up a 1st prize at this, his first ever show.

Neil Cox presents 1st prize to Leslie Cook (right), from Over in Cambridgeshire, for his winning Hereford steer, with his daughter Frances (left) holding her father’s 2nd prize steer.

Julia Banwell presents the winning rosette to Henry Dart (right) and his son Christopher (left), from South Molton in Devon, for their pair of Exmoor Horn wether lambs.

Although R&D is not an immediately obvious expense for farmers, those investing in specialist breeding programmes or developing particular technologies for use on the farm could qualify for the tax relief, says accountant Old Mill Rural Services.

“Tax breaks for this type of investment have been around for a number of years, but many businesses have been deterred from making an claim as they feel that they need to be involved in very high-tech work – this simply is not the case,” says corporate tax manager Isobel Savage.

In August, HMRC increased the tax relief from 150% to 175%, enabling small and medium-sized businesses to deduct 175% of qualifying R&D expenditure against profits.

Businesses must spend at least £10,000 per annum to qualify, but this can include a wide variety of related costs, including employee salaries, overheads such as heat and light, materials costs and even an element of costs from subcontractors, she adds.

“The R&D work must be relevant to the business and there needs to be an intention to exploit the benefits from this commercially.” The work should involve developing scientific or technological knowledge that isn’t commonly available, to improve a product, process or service.

“In related businesses such as agricultural engineering or added-value food production the opportunities are far clearer,” says Mrs Savage. “While many businesses may already be making claims, the increase in the tax allowance should lead all businesses engaged in these sectors to consider their options carefully.”

A business with qualifying expenditure of £12,000 a year could now claim a deduction for tax purposes of £21,000. For a higher rate taxpayer that would reduce the tax payable by £3,690, while for a small company paying tax at 21% it would save £1,890.

“R&D is an essential part of many agricultural businesses, but hands-on farmers may not even be aware that they can claim these expenses back,” says Mrs Savage. “With the increase in the relief available, farmers and related industries could make considerable savings. And with the deadline for online tax returns looming, businesses should speak to their tax advisor and work out whether they are eligible to claim this valuable tax relief.”

Old Mill Managing Partner Jolyon Stonehouse comments, “We have been enjoying rapid organic growth, increasing both income and headcount by more than 10% each year since the management buy-out. However we now feel it is appropriate to enhance our business further by merging with LE Bull and Co. Their client base fits well with our own, and they share our philosophy of providing first class client service while being an outstanding place for staff to work. We are excited by the prospect of a Wiltshire office which will help us serve our considerable number of existing clients in the county and provide a base to further grow our business there.”

All members of the staff of L E Bull and Co will be taken on by Old Mill and there are expansion plans for the office as Old Mill introduce their full range of client services.

Paul Neate senior partner of Bull and Co observes “The synergies between the two companies are excellent. We specialise in looking after farming clients and the Old Mill rural services teams are already the leading supplier of accounting services to West Country agriculture.  Our existing clients will be able to benefit from the specialist tax and financial services advice that is part of the Old Mill package. .”

Paul will become a partner in the Old Mill Rural Services team and John Smith, his fellow L E Bull and Co partner, will become the Senior Manager in the Rural Service team.

Old Mill already operates from offices in Shepton Mallet and Yeovil and earlier this year launched a full service offering office in Exeter.

Rural accountant Old Mill has brought together a range of industry experts to offer farmers the best information and advice at an important evening meeting on 11 November.

“Planning has always been an important part of successful farming enterprises,” says Andrew Vickery, Manager of the Old Mill Rural Services team in Exeter. “But in such uncertain times it is even more essential, so that you can protect against unforeseen difficulties and capitalise on opportunities as they arise.” Speakers at the meeting, entitled Farming Today, and Tomorrow, will examine the state of the industry today and identify areas of potential opportunity, as well as possible pitfalls, over the coming months and years. Kicking off will be Euryn Jones, Barclays’ National Agricultural Specialist, who will share his thoughts on how farmers can plan their future in an unpredictable world. John Warrington, Farm Consultant with Promar International, will examine Promar’s latest dairy farm performance data, so delegates can see how their own farm results compare and pinpoint areas to increase profitability. Finally, Andrew Vickery will identify a number of both current and longer-term tax issues facing farmers. “These can have a significant impact on cash flow, your bottom line and longer term succession plans,” he says. “By bringing together this cross-section of industry specialists and encouraging discussion among all of our delegates, we hope to give farmers a clearer picture of where their business is heading, and offer them the tools to make the most of whatever the future might hold.” The meeting will be held at Padbrook Park Golf Club, Cullompton, Devon, on 11 November at 7.00 for 7.30pm, followed by a hot supper. To book your place, or discuss individual tax planning issues, call Old Mill Rural Services on 01749 335007. Journalists are welcome to attend.

“You may have to work harder but the property business is still alive,” said Mr Gregory. “The market is certainly not dead, deals are still being done and sales are still being made.”

He did say though, that some responsibly must lie with the Government saying that Gordon Brown needs to “make an early U turn on rates on empty buildings.”

The legislation, which only came into force this April, rules that properties that have been empty for more than three months will no longer receive the 50 per cent relief from business rates, with industrial properties losing the relief after six months of being unoccupied.

The new rules aimed to ensure that landlords let properties out; however Mr Gregory claims it is actually having the opposite effect.

“It is now discouraging developers from advancing new projects,” he said, “and means that existing companies are less likely to move and leave a vacant office without another tenant ready to move in.”

Also speaking at the event was Bruce Lockhart, tax partner at Old Mill accountants and financial advisers. Mr Lockhart spoke about the tax issues that affect the property market, particularly the new tax allowance on integral fixtures and energy efficient systems in new buildings, which he called a “rare positive change”.

The meeting was the third quarterly meeting this year of the Western Business Forum and was organised by LloydsTSB, solicitors Thring Townsend, Old Mill and executive coaches, Inside Out. Every quarter a new discussion point arises and this time their attention was turned to property. The next will take place on Thursday 4 December at Cumberwell Park Golf Club when the topic will be “Planning to make it happen in 2009.” For more information please go to www.westernbusinessforum.co.uk or call 01749 335007.

At the end of the five years, returns for the investor are linked to the best two performing portfolios; the plan completely disregards the worst performing while offering 100% capital protection.

Thanks to its low risk and potentially high gains, the ABC Hindsight Plan has proved very popular with investors. It opened for subscriptions on July 21st, closed on Friday and in that short period saw investments of more than £3.3million.“The ABC Hindsight Plan certainly captured the imagination of our clients” says Simon Cole, Chartered Financial Planner and Partner at Old Mill.  “Many people understand the benefits of long term investing but may have been put off by recent stock market movements,” he said, “but this Plan allows our clients to invest with a far greater degree of confidence.”

“Even the purchase of a moderately priced tractor for, say, £30,000, could reduce profits enough to not only reduce income tax and National Insurance payments, but also to facilitate a tax credit claim,” says Rural Tax Planning Specialist Catherine Vickery.”Tax credits can be very valuable where profits are low in the year and can, depending on individual circumstances, entitle you to thousands of pounds.” The family element of child tax credit is available where income is up to £58,000, for families with up to two children. However, claims can only be backdated by three months, so if profits are likely to fall within tax credit limits for the year it is important to submit provisional claims as soon as possible, she adds. “With weakening commodity prices and the credit crunch underway this extra income could provide a welcome boost.” On the flip side, the fluctuation in profit levels created when claiming the AIA can have a detrimental impact when applying for a loan or mortgage. “Setting up to £50,000 against income in a single year means profits may swing wildly from one year to the next, particularly for farming businesses which often have high capital expenditure one year, but low the next,” says Mrs Vickery. “Farmers making a substantial AIA claim could wipe out profits altogether.” It is therefore essential to consider the timing of making such a claim so as not to jeopardise a loan or mortgage application. However, there may be ways to explain the position to potential lenders, such as including a deferred tax adjustment in the accounts, she adds. “That seems more sensible than accepting a higher tax bill just to facilitate borrowing.”

For more guidance on tax credit entitlements and AIA claims, contact Kim Davis, Tax Consultant at Old Mill Rural Services, on 01935 709338.

“The ABC Hindsight Plan is a five year plan that is linked to three portfolios; Adventurous, Balanced and Cautious,” explains Simon Cole, Chartered Financial Planner and Partner at Old Mill. “Each portfolio invests differently, gaining exposure to a wide variety of areas, including emerging markets like China as well as funds in the UK, America, Europe and Japan. All three portfolios will also have commodities exposure, while the Balanced and Cautious portfolios will also benefit from rising inflation,” he said. “At the end of the five years, returns for the investor will be linked to the best two performing portfolios; the worst performing will be completely disregarded. And, provided the investment is held for the full five years, the ABC Hindsight Plan offers 100% capital protection.” “The ABC Hindsight Plan is exclusive to Old Mill,” says Mr Cole, “and due to its low risk and potentially high gains, we think it is going to be very popular with our clients.”

In order to make the plan as tax efficient as possible, investments can be made directly to utilise Capital Gains Tax allowances, tax free via an Individual Savings Account (ISA) or Self Invested Personal Pension (SIPP), or through an Offshore Bond, where tax can be deferred. The minimum investment for the ABC Hindsight Plan is £7,200 via an ISA, which is the maximum ISA investment for this tax year - or £10,000 via any other investment product. The ABC Hindsight Plan has limited availability, opening for subscriptions on July 21st and closing at the latest on September 12th, if not already fully subscribed. Early investors will also receive a competitive rate of interest during the offer period.

To find out more about the Old Mill ABC Hindsight Plan, telephone Gavin Jones 01749 343366 or email sheptonmallet@oldmillgroup.co.uk For more information about this release contact Alan Stone at Old Mill 01749 335007 or email alan.stone@oldmillgroup.co.uk

Businesses with finance scattered across a number of different providers could save money by consolidating their borrowing into one loan or mortgage, he explains. “Despite the credit crunch agricultural banks are still very much open for business and there are still some good deals out there.”

Improved profits in some agricultural sectors could either be used to reduce debt or reinvest in the business, and farmers releasing larger capital sums could make wise use of changes in the tax regime, he adds.

“Anyone with non-business assets like buy-to-let properties or quoted shares could benefit from recent changes to CGT, which have reduced tax on non-business capital gains from up to 40% to a maximum of 18%.”

For example, a rental property purchased five years ago which now stands a capital gain of £150,000, owned jointly by a husband and wife paying the higher tax rate, could be disposed of with a tax liability of £27,000 compared to up to £54,000 under the old regime. “Now could now be the ideal time to release funds from such investments to repay business borrowing or fund new projects,” says Mr Vickery.

New investments, such as expanding a dairy enterprise or building a new grain store, should always be carefully considered from both a financial and a tax perspective. “The phasing out of Agricultural Buildings Allowances will play an important part in your calculations, but there are other new tax reliefs, including changes to Capital Allowances, which could be particularly beneficial,” he adds.

“Whatever your situation, it is worth speaking to your bank manager and scouring the market to get the right finance package to suit your business. If you are considering making new investment decisions or disposals take professional advice - this could be the right time to make changes for the better.”

For more information contact:

Alan Stone, marketing manager - Tel: 01749 335007, or e-mail: alan.stone@oldmillgroup.co.uk

About Old Mill Rural Services

Old Mill accountants and financial advisers employ 160 staff in three West Country offices. The Rural Services teams are headed by Partners Mike Butler (Yeovil) and Ian Sharpe (Shepton Mallet). Looking after nearly 1,000 farmers they are one of the leading specialist farm accountants, and are happy to help with any financial and tax-related enquiries from the media.

From July 1 2008, Fuel Advisory Rates for company provided petrol vehicles with an engine size of 1400cc or less will go up 1p to 12p, for diesel, the rise is 2p up to 13p. For vehicles with engine sizes up to 2000cc, the rise is 2p for both petrol and diesel, going up to 15p and 13p respectively. And for larger vehicles, petrol reimbursement has gone up from 19p to 21p and diesel from 14p to 17p. (See table below for full rate information).

But, for those who drive their own cars, the AMAP (Approved Mileage Allowance Payments) hasn’t changed, in fact, at 40p for each business mile up to 10,000 and 25p for each over 10,000, it has remained static since 2002.

Despite the fact that evidence from both the RAC and the AA suggest that the true cost of private mileage is now 50p, and many groups are actively lobbying the Government for a long overdue increase, HMRC says its research shows that no changes are necessary in the foreseeable future, and this says Andrew Wholey, tax consultant at Old Mill Financial Services, means that employees undertaking business mileage in a private vehicle are losing out.

“Due to the fact that Government has refused to raise the AMAP, many employees undertaking business mileage in their private car incur actual costs in excess of the rate at which they can be reimbursed by their employer,” said Mr Wholey.

“While employees who drive company owned vehicles have seen regular increases over the years - 50 per cent since 2002 - it is an entirely different story for employees who do not benefit from the use of a company car and have to pay all their own running costs - not just fuel, but tax, insurance, depreciation and any other costs associated with running a car.

“This group are really losing out due to the fact that the AMAP - which is supposed to take all the costs of running a car into account - has not seen an increase in six years, despite the fact that in that time, the cost of fuel has risen from 74p a litre in June 2002 to 118p a litre now.”

And, says Mr Wholey, this situation is made worse still where instead of adopting the AMAP, employers use the lower Fuel Advisory Rates for reimbursing the cost of fuel and business mileage undertaken in an employee’s private car. Employers too, are trying to contain costs and this practice is increasingly common.

“In this situation,” he explains, “it is left to the employee to claim a tax deduction on their personal tax return equal to the difference between the two contrasting rates.

“This can be a daunting prospect for some, and many simply don’t bother. But they should, because, for a higher rate tax payer undertaking 6,000 business miles, the difference between the 40p AMAP and the 15p Fuel Advisory Rate is 25p per mile - an annual tax save of £600.”

Although, says Mr Wholey, an increase in the AMAP is long overdue, in the meantime he advises employees who drive their own vehicles that are only being reimbursed using the lower Fuel Advisory Rates (or another rate, lower than the AMAP) to at least ensure that they benefit from the additional tax relief they may be entitled to.

“Claiming back the difference between the Fuel Advisory Rate and the AMAP isn’t as complicated as they may think and in this way they can mitigate the impact of a “double whammy” as the costs of fuel continue to escalate,” he said.

Ends

Previous Rates

Guy, who qualified as a Chartered Accountant in 1990, worked as a Corporate Finance specialist for six years with a top 4 accountancy firm before joining Old Mill’s Exeter branch in 2005 to set up a new Corporate Finance team for the South-West.

Not only has Guy been instrumental in the establishment and success of that team, but he has also played a significant part in the development of the Exeter office as a whole.

Since his appointment, the Exeter office has expanded significantly and can now offer a full service thanks to corporate finance specialists, tax experts, an accounts and audit team, rural and farm accounts specialists and independent financial advisors. Old Mill financial services is the largest independent firm of IFAs in the region and one of only a few with Corporate Chartered Financial Planner status.

“Guy’s successful expansion of Old Mill’s service offering from Exeter has led to his well deserved elevation to partner,” says managing partner Jolyon Stonehouse.

“Guy has been instrumental in the creation of the Old Mill Corporate
Finance service for the whole of the South West, allowing all three of Old Mill’s branches - Exeter, Shepton Mallet and Yeovil to benefit from his hard work. Having Guy on board as a Partner is excellent news as his promotion allows his respected expertise to benefit the business and the region as a whole.”

Guy says he is delighted with his promotion. “I am really looking forward to my new role as Partner and the challenges it will bring,” he said.

“Since I started at Old Mill, the Exeter office’s offering has changed significantly; we have brought together quality accounting, tax and financial services in order to provide an integrated service for our clients and I am excited about taking the business further forward still.”

Mr Hill, who enjoyed considerable success in the showing classes with his Quaish herd of Limousin cattle, won the award for best presentation of cattle in the lines.

Ian Sharpe, partner at Old Mill’s Shepton Mallet office, said he was delighted to continue the firm’s tradition of sponsoring the Cattle Presentation Award. “We think it is important that the cattle in the lines are made accessible and are well presented to the public,” he said.

“Many people come to the Bath & West Show to look at the wonderful animals which are on display, and it’s important to maintain that link between farming and the general public.

“Nick Hill presented his Limousins beautifully, with great care and attention to detail, and it is with great pleasure that I present him with this award.”

Old Mill Rural Services was also asked to present the Nelson Burden Award for outstanding contribution to the Show’s beef cattle section. This year it was won by Geoffrey and Doreen Fuller from Minehead, Somerset.

Ian Sharpe & Nick Hill - High resolution photograph (803KB)

Nelson Burden Award - High resolution photograph (787KB)

For more information contact:

Alan Stone, marketing manager - Tel: 01749 335007, or e-mail: alan.stone@oldmillgroup.co.uk

About Old Mill Rural Services

Old Mill accountants and financial advisers employ 160 staff in three West Country offices. The Rural Services teams are headed by Mike Butler (Yeovil), Ian Sharpe (Shepton Mallet) and Andrew Vickery (Exeter). Looking after nearly 1,000 farmers they are one of the leading specialist farm accountants, and are happy to help with any financial and tax-related enquiries from the media.

With climate change a hot political topic, the opportunities for everyone to do their bit are growing fast - and can have a dramatic impact on both the environment and the pocket, says accountant Old Mill.

It is supporting the Eco-Gym at this year’s Royal Bath & West Show, in a bid to show people how easy it can be to become eco-friendly. Visitors to the Show will be able to burn off a few calories while making a delicious smoothie on a special blender bike, or use their own muscles to generate electricity for Scalextric and toy train races.

“This is an area where people can visualise energy,” says John Jackson, partner at Old Mill. “They can find out just how hard it is to keep one light bulb on, or run a TV, or even boil a kettle. They can lift the weight of their own carbon footprint and by using their own energy see the size of the problem facing the planet.”

The Eco-Gym is part of the Show’s Eco-Zone, a fascinating area where visitors can learn all about environmentally-friendly technology, from renewable fuels and solar energy to green packaging and anaerobic digestion.

Experts will also be on hand to offer one-to-one advice on becoming more energy efficient, and trade stands abound in commercial options available to farmers, individuals and other businesses.

“The Eco-Zone is a small but essential step in the long road to public acceptance of the need for change, and a precursor to more ambitious intentions for the showground,” says Archie Montgomery, who farms in North Cadbury, Somerset, and helped to create the Eco-Gym. “For some years it has been obvious that Britain, with its historical abundance of coal, oil and gas, has taken a very different view of national energy security compared to its European neighbours.”

Continental countries with poor fossil fuel resources have successfully developed renewable alternatives, many of which rely on farmers and the land-based industries to provide the raw materials - including wood, crop-based biofuels or waste products.

“This has improved farmers’ livelihoods and income security and helped to create wealth in local communities,” says Mr Montgomery. “We have a lot to learn in this country, and the Bath & West Show is an ideal opportunity to publicise information about sustainability which is already household knowledge amongst our European neighbours, and in the process promote the market for the land-based renewable sector.”     

• For full details of the Show, which will be held from May 28-31, visit http://www.bathandwest.com/ or ring the Bath & West Showground on 01749 822200.

• Staff from Old Mill Rural Services will be available to discuss the benefits of adopting environmentally-friendly practices, as well as any financial and tax-related issues, at the Old Mill stand in the Showering Pavilion.

For more information contact:
Alan Stone, marketing manager - Tel: 01749 335007, or e-mail: alan.stone@oldmillgroup.co.uk

About Old Mill Rural Services
Old Mill accountants and financial advisers employ 160 staff in three West Country offices. The Rural Services teams are headed by Mike Butler (Yeovil), Ian Sharpe (Shepton Mallet) and Andrew Vickery (Exeter). Looking after nearly 1,000 farmers they are one of the leading specialist farm accountants, and are happy to help with any financial and tax-related enquiries from the media.

Faced with poor commodity prices over the past decade, many farmers have looked at ways to maximise profitability through exploiting non-core streams of income, says Ian Sharpe, partner at accountant Old Mill Rural Services.

“This is perhaps most evident in the family farm scenario where some family members now earn the bulk of their income from employment away from the farming business.”

In a sample of 150 of Old Mill’s farming clients, 56% have significant other enterprises outside of traditional farming activity, with the most common being income from property interests. “Some 37% of farms now have an element of property management, varying from residential lettings to bed and breakfast and office units,” says Mr Sharpe.

The next most popular form of alternative income is off-farm contracting, at 11%. Added value enterprises make up 3% of diversifications, with commercial shooting coming in at 2%.

“In addition, 15% of farms have one of a number of other diversification projects ranging from golf courses to horse livery and farm shops,” he adds. Many also have more than one diversification falling into the above categories.

“But it is important to note that these figures only relate to farm diversification, not to non-farming jobs undertaken by family members. Off-farm employment now forms a significant part of modern farming family life.”

The impact such diversification has on the bottom line ranges from a few thousand pounds to over a million -in some cases considerably overtaking the core farm activity, says Mr Sharpe.

“Some farmers can no longer be considered food producers - they are multi-skilled businessmen and women who have made best use of their resources to not only survive the hard times but thrive and grow their business as each year passes.”

Although many commodity prices are returning to profitable levels, Mr Sharpe expects a lot of farmers will continue to diversify. But it is important that they examine any major business change carefully, not least because of the practicalities of running a new venture alongside the core farming enterprises.

There are also important Capital Gains and Inheritance Tax implications, and advice in these, and other specialist areas, such as planning and employment, is crucial, he adds. “Careful preparation is essential to put a new business on a sound footing before trading commences, and to reduce the chance of unforeseen problems down the line.”

The new Enhanced Capital Allowances (ECA) offer energy saving or water conserving plant and equipment a 100% write off in its first year, says accountant Old Mill Rural Services. “This could be a major boost for anyone considering putting in new dairy infrastructure to meet tighter regulations under Nitrate Vulnerable Zone proposals, for example,” says Mike Butler, director of rural services.

Eligible water conserving options include water efficient taps, showers and toilets, slurry separators, meters, and rainwater harvesting equipment. Energy saving lighting, refrigeration equipment, boilers and compressors also qualify for the new allowance.

“With improved profits in arable and dairy sectors, as well as tightening environmental legislation, many farmers are planning significant reinvestment in their business over the coming years,” says Mr Butler. “This new allowance could provide them with a major tax saving for adopting environmentally-friendly practices. Not only will they have lower tax bills, they will enjoy lower utility bills as well.”

Many dairy farmers are considering installing rainwater harvesting technology on new buildings, and it is possible that a significant proportion of the building itself will qualify for the 100% first-year allowance.

Currently, agricultural buildings qualify for a 4% annual allowance, but this is being phased out from April. Capital allowances on plant and equipment will offer a 100% write in the first year from April, up to a maximum of £50,000, followed by a 20% annual write-off thereafter. “This is great news for anyone buying new plant and equipment,” says Mr Butler.

“But someone buying a new tractor can quickly reach the £50,000 limit. Fortunately, the ECA will run alongside the normal Capital Allowance regime, and is not capped, so farmers buying a new tractor and investing in environmentally-friendly equipment will benefit from full relief on both purchases.”

This is particularly welcome, given the significant increase in farmers’ likely tax liabilities due to higher farm profits and the phase-out of Agricultural Building Allowances, says Mr Butler.

Anyone looking to erect a tax-efficient agricultural building and reduce their income tax bill should consider using a Self-Invested Personal Pension (SIPP), he adds.

“Take, for example, a farming partnership with £120,000 profit this year, which wants to erect a £120,000 new building. By paying £60,000 into a SIPP before April 5, and another £60,000 after April 6, the partnership will save £24,000 in tax for each tax year. They can then invest that money into the new building, getting 100% tax relief, and reducing the actual cost of the build to just £72,000.”

Fore more details on how to make the most of SIPPs or the new Enhanced Capital Allowances, contact Mike Butler on 01935 709301.

Ends.

Notes to editors

For more information contact
Alan Stone - Marketing Manager
Tel: 01749 335007
E-mail: alan.stone@oldmillgroup.co.uk

About Old Mill Rural Services
Old Mill accountants and financial advisers employ 160 staff in three West Country offices. The Rural Services teams are headed by Partners Mike Butler (Yeovil) and Ian Sharpe (Shepton Mallet). Looking after nearly 1,000 farmers they are one of the leading specialist farm accountants, and are happy to help with any financial and tax-related enquiries from the media.