Lump Sum Exit Scheme – Applications now open
Applications are now open for the Lump Sum Exit scheme for those wishing to exit the industry.
Basic Payment Scheme (BPS) applicants in England can now apply for a lump sum if they wish to leave farming. The scheme will allow applicants to receive a portion of their future BPS money upfront, in return for surrendering their BPS entitlements and either renting or selling most of their land, or giving up their tenancy.
To receive the lump sum, you must transfer out the land in England which was agricultural land ‘at your disposal’ on 17 May 2021 – the BPS 2021 application deadline. This land will have been eligible for BPS.
Land was at your disposal if you were the:
- owner-occupier, farming the land yourself or employing a contractor
- tenant with a Farm Business Tenancy under the Agricultural Tenancies Act 1995 or an Agricultural Holdings Act 1986 tenancy (or equivalent).
You do not need to transfer out:
- up to 5 hectares of that agricultural land
- agricultural land you plant with trees under a woodland creation scheme
As you only need to transfer out agricultural land, you do not need to transfer out:
- land parcels, or parts of land parcels, that were non-agricultural land on 17 May 2021 (such as woodland, even if this was eligible for BPS)
- any buildings – for example, if you own your farmhouse you can choose to keep it
Payments will be calculated based on the average sum of direct payments made to the farmer between 2019 – 2021 Basic Payment Scheme years. The figure will be capped at £42,500 and multiplied by 2.35 to calculate the lump sum available through the scheme, meaning farmers could receive up to £100k.
Applications are open now (from April 12th) until September 30th 2022. It is unlikely that the scheme will run again in the future, so those considering it as an option will need to act this year. For full details on the scheme, and details on how to apply, please visit the Gov.uk website here.
If you are considering this scheme and have ideas for a future business or project, please contact us for help, business advice and potential sources of funding to get your new ideas off the ground.