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* Rural Payments Agency Guidance SINGLE OR SEPARATE, NEW OR CONTINUING ASSESSMENT EXAMPLES Published 10 February 2020 APPLIES TO ENGLAND CONTENTS * Single or separate businesses * New or

continuing businesses Print this page © Crown copyright 2020 This publication is licensed under the terms of the Open Government Licence v3.0 except where otherwise stated. To view this

licence, visit nationalarchives.gov.uk/doc/open-government-licence/version/3 or write to the Information Policy Team, The National Archives, Kew, London TW9 4DU, or email:

[email protected]. Where we have identified any third party copyright information you will need to obtain permission from the copyright holders concerned. This publication is

available at https://www.gov.uk/government/publications/rural-payments-if-the-structure-of-your-business-is-changing/single-or-separate-new-or-continuing-assessment-examples The following

cases are examples only and are not based on any real life people or businesses. Your case may have a different outcome. SINGLE OR SEPARATE BUSINESSES When we assess whether a farming

business is a single or separate business under IACS rules we take into account the business structure and if the business or any business members have an interest in any other farming

business. Who is farming the land and applying for payment is part of our assessment, but where the land is, or who owns the land is not. Other factors such as the percentage shareholding,

who has ultimate responsibility for long-term and, or day-to-day decisions and transactions between the businesses are also part of our assessment. The following examples explain how

shareholdings can affect the final outcome. (These examples do not take into account who has responsibility for long-term and, or day-to-day decisions which may also affect the outcome.)

EXAMPLE 1 WILLOW FARM (3 PARTNERS) SBI 333888777 The business rears livestock and grows some forage crops. Tim Newark lives with his wife Mandy, at Willow Farmhouse, New Lane, Anytown, XX1

1XX where all the Willow Farm business records are maintained by Mandy Newark. The business has land close to the farm buildings and also has grazing rights on Sieve Common, 14 miles away.

PARTNERSHIP STATUS / ROLE PERCENTAGE SHARE HOLDING Tim Newark Partner 50% Martin Newark Partner 20% Fiona Newark Partner 30% Mandy Newark Partner 0% Members of this business are also

involved in two other farming businesses: M & F Dairy Enterprise (partnership) and Tasty Tamworths (sole owner), both at Ghyll House Farm. Martin and Fiona Newark are married and live

with their daughter Katie, at Ghyll House Farm, Old Lane, A village, XX1 2XX. This farm is 16 miles away from Willow Farmhouse and 12 miles from Sieve Common. Fields close to the farmhouse

are used for animal grazing and crop production by the Willow Farm business. A further two fields are used exclusively by Martin Newark for Tamworth pigs. Other fields are used exclusively

by M & F Dairy Enterprise to rear Fiona and Martin’s herd of Jersey cows. M & F DAIRY ENTERPRISE (2 PARTNERS) SBI 777444222 PARTNERSHIP STATUS / ROLE PERCENTAGE SHARE HOLDING Martin

Newark Partner 50% Fiona Newark Partner 50% Katie Newark Employee 0% (works part time for her parents and also at a neighbouring farm) TASTY TAMWORTHS (SOLE TRADER) SBI 333999666 PARTNERSHIP

STATUS / ROLE PERCENTAGE SHARE HOLDING Martin Newark Sole trader 100% ASSESSMENT As there are common partners (Martin and Fiona) in these businesses, we have to assess whether all of the

businesses they have an interest in, are separate under IACS rules. As neither Martin nor Fiona (total of 50% in Willow Farm and 50% each in M & F Dairy Enterprise) have a majority

shareholding in Willow Farm, we will assess these as separate businesses under IACS rules. However, other factors we take into account such as, who has responsibility for long-term and, or

day-to-day decisions, may also affect whether these are a single or separate business. EXAMPLE 2 Different percentage shareholdings. WILLOW FARM (3 PARTNERS) SBI 333888777 PARTNERSHIP STATUS

/ ROLE PERCENTAGE SHARE HOLDING Tim Newark Partner 34% Martin Newark Partner 33% Fiona Newark Partner 33% Mandy Newark Secretary 0% M & F DAIRY ENTERPRISE (2 PARTNERS) SBI 777444222

PARTNERSHIP STATUS / ROLE PERCENTAGE SHARE HOLDING Martin Newark Partner 50% Fiona Newark Partner 50% Katie Newark Employee 0% TASTY TAMWORTHS (SOLE TRADER) SBI 333999666 PARTNERSHIP STATUS

/ ROLE PERCENTAGE SHARE HOLDING Martin Newark Sole Trader 100% ASSESSMENT Martin and Fiona now have a majority shareholding in Willow Farm (66%) and 100% in M & F Dairy Enterprise, we

will assess these as a single business. As Fiona has no shareholding in Tasty Tamworths, this remains a separate business. EXAMPLE 3 Different percentage shareholdings. WILLOW FARM (3

PARTNERS) SBI 333888777 PARTNERSHIP STATUS / ROLE PERCENTAGE SHARE HOLDING Tim Newark Partner 10% Martin Newark Partner 70% Fiona Newark Partner 20% Mandy Newark Secretary 0% M & F DAIRY

ENTERPRISE (2 PARTNERS) SBI 777444222 PARTNERSHIP STATUS / ROLE PERCENTAGE SHARE HOLDING Martin Newark Partner 70% Fiona Newark Partner 30% Katie Newark Employee 0% TASTY TAMWORTHS (SOLE

TRADER) SBI 333999666 PARTNERSHIP STATUS / ROLE PERCENTAGE SHARE HOLDING Martin Newark Sole Trader 100% ASSESSMENT Although Martin and Fiona have a majority shareholding in Willow Farm

(90%), Martin also has the majority shareholding in both Willow Farm (70%) and M & F Dairy Enterprise (70%). In example 2 we still assess these as a single business. However, as Martin

has the majority shareholding in both businesses this now affects his own business, Tasty Tamworths. Because he has the majority or total shareholding in all three businesses we now assess

all these as a single business under IACS rules. NEW OR CONTINUING BUSINESSES Where there has been a change to the status or structure (depending on what that change is), and none of the

members have an interest in another farming business, we will assess the business as a new or continuing business. For example: ORIGINAL STATUS CHANGE OUTCOME Sole Trader Death of sole owner

New business requires a new SBI Sole Trader Death of new owner New business requires a new SBI Sole Trader A partner joining Continuing business – keeps existing SBI Partnership Death of a

partner Continuing business – keeps existing SBI Partnership A partner leaving Continuing business – keeps existing SBI Partnership A new partner joining Continuing business – keeps existing

SBI 2 or more businesses merging - May keep one of the existing SBIs depending on the terms of the merger and the areas of land involved. The entitlements must be transferred to that SBI

using one or more RLE1s A business has split into 2 or more businesses - If at least one of the original business members remains in one of the businesses and has the majority of the land,

in most cases that business will be a continuing business and will keep the original SBI. We will give new SBIs to the other businesses and will assess them as new businesses. Where there is

an equal split we may assess each as a new business and give each a new SBI. For any entitlements that are being transferred to a new business fill in an RLE 1 Sale of a business The new

owner does not have an interest in another farming business We will assess this as a new business and give it a new SBI. The previous owner must fill in an RLE 1 Sale of a business The new

owner already has an interest in another farming business We will carry out an assessment in the same way as in the single or separate business examples Back to top