Question to the HM Treasury:

To ask the Chancellor of the Exchequer, what recent assessment he has made of the effect of the fiscal framework on farmers who have diversified from farming activity.

A longstanding feature of the UK tax system is that a person’s UK farming income is treated as one trade. When a farming business diversifies, any non-farming activities are treated as separate sources of income that need to be declared separately on the tax return. The Government recognises that this creates additional administrative burdens. However, taxing diversified rural businesses as one unit would carry a risk that uncommercial activities might be grouped together with profitable trades. The Government keeps all taxes under review but has no plans to change the current tax rules for diversified rural businesses.