Small Woodland Owners' Group

Death and Taxes

Paperwork, grants, legal issues

Postby tracy » Tue Apr 01, 2008 10:13 am

2 certain things!

Dawn wanted to know what your plans are for your woodland when you die!?


Maybe someone could also post what they know about the Woodland and Tax issue?


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Postby Dennis » Thu Apr 03, 2008 2:44 pm

Just to enter \"woodlands\" in the search engine at http://www.hmrc.gov.uk/ gives lots of useful hits in theri manuals and publications.


Start here: http://www.hmrc.gov.uk/manuals/bimmanual/BIM67701.htm


Look at this: http://www.hmrc.gov.uk/manuals/cg4manual/CG73200.htm - Be careful - exempt only from CGT


When you die your folks should look here: http://www.hmrc.gov.uk/cto/customerguide/page18.htm - do talk to a specialist lawyer - it can save you huge amounts of tax.


Search me why this is in the CGT manual because it says that coppicing is treated as farming (a trade liable to income tax): http://www.hmrc.gov.uk/manuals/cg4manual/CG73202.htm


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Re: Death and Taxes

Postby Meadowcopse » Tue Feb 18, 2014 7:38 pm

Although I have no plans to die in the very near future, the (otherwise incurable) Crohns Disease has caught up with me a little over the last year.
Without wishing to get into a Channel Four 'Benefits Street' type debate, I can not at present carry out my normal work (oil & gas industry north-sea, requiring an industry specific medical certificate).
I have come to the end of my employers Statutory Sick Pay period and still between hospital appointments and trying to get well, have been directed towards completing an ESA claim whilst a longer term outlook is mutually worked out.

A cautionary tale for land owners with plots not attached to their residence...
I knew around 9 years ago I might have to finish the type of work I normally do and made myself financially secure (no mortgage, no debt and some on one side for a rainy day).
Back then I had the option of legitimately retiring at 50, but the then government shifted that up to 55. (I'm presently 45). The Company Doctor and HR and my Pension provider are at the early stage of discussing partial incapacity severance.
With 28 years N.I. contributions I probably qualify for part of the ESA allowance whilst this drags on, but probably not the means tested element due to savings and particularly if the value of my meadow / orchard is added.
A specific form A64A 04/13 enquires of the description, use, location and value of the land.
Also: "Are you taking steps to dispose of the property or your share in it. Yes / No ?"
They reserve the right to make a valuation survey (I hope they try that whilst it's under 3 feet of water)!
There are a few other questions about any co-owners, planning permission being sought, who bought it, how much, original purpose...

Hopefully I will come to an agreement with my employer before an ESA claim is processed and that will be the end of the matter.
The above might be of interest to anyone else of working age with an underlying health problem, or anyone that may end up in a nursing home, as I guess similar forms of asset declaration are used for care fees.
It also makes the early setting up of a Trust an interesting debate or shared ownership.

Meanwhile, I guess if I hadn't been financially prudent to eradicate any personal debt and with an excess sufficient to buy a small plot, but instead drank my way through Weatherspoons for a decade and had a few flashy cars and holidays and latest consumer goods, the form wouldn't have been an inclusion with no capital asset to declare...
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Re: Death and Taxes

Postby oldclaypaws » Tue Feb 18, 2014 9:07 pm

Last October when diagnosed with cancer my first and not uncommon reaction was 'sell the wood, rehome the dogs, sell the coin collection, tart up the house and buy a small flat for the wife so she can manage on her own'.

Fortunately I didn't do any of that, but it does focus the mind on your (limited?) future. Another reason I was particularly pleased I didn't do any of it was when I saw my consultant after surgery and biopsies for the dreaded "this is the way it is" talk. I was shocked and felt sick when she said "This doesn't happen very often, but I was wrong. I apologise for the stress it must have caused you and your family, but all the swollen cancer-like tissues and other symptoms were actually a result of infection, the biopsies show you don't have cancer at all, you're fine, go away and live a long happy life to the full." You could say "phew !!" :roll: :D

Now that I've got used to the idea of being around for a good while longer, maybe another 35 years or so, I can get the wood into the shape I want and try to find an appropriate eventual custodian after the doctors eventually do get it right and I depart. Possible option at the moment as its an ancient wood with archaeology and a county wildlife site is leaving it to the trust recently set up by the Council for interesting historic and natural properties they are bequeathed. It wouldn't be bad for the council. They muck it up, sell it to me for a fortune, I clean up all the stuff they left, get it the way it should have been and then give it back to them for nothing !!
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Re: Death and Taxes

Postby TerryH » Tue Feb 18, 2014 9:14 pm

Meadowcopse wrote:With 28 years N.I. contributions I probably qualify for part of the ESA allowance whilst this drags on, but probably not the means tested element due to savings and particularly if the value of my meadow / orchard is added.
A specific form A64A 04/13 enquires of the description, use, location and value of the land.
Also: "Are you taking steps to dispose of the property or your share in it. Yes / No ?"
......
Meanwhile, I guess if I hadn't been financially prudent to eradicate any personal debt and with an excess sufficient to buy a small plot, but instead drank my way through Weatherspoons for a decade and had a few flashy cars and holidays and latest consumer goods, the form wouldn't have been an inclusion with no capital asset to declare...


What is the threshold in savings/assets for the means tested part to be allowed then (if you don't mind me asking.. not trying to pry etc) ?

Yes, isn't it amazing.. the UK economy is now so debt-based (having been engineered to be that way by the last two or three governments and their pals in the banks ) that the prudent are shafted by ZIRP, 375 BILLION pounds worth of 'QE', FLS etc. So what are we to do .... perhaps take some of our hard earned money and convert it into a very small land holding before there's no value left in the cash at all. But then to qualify for full ESA they'd like you to sell up so you're back again to being overly state-dependant, with less set aside for the future..

No, no, no... you should have taken out a big mortgage/loan from the bank for the land... do your bit for Britain. Who knows, maybe they'd have a a nice little Help to Buy scheme for orchards (Help to Grow ?)

Okay, off my soapbox now :D
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Re: Death and Taxes

Postby Meadowcopse » Tue Feb 18, 2014 10:03 pm

I think the threshold is £16,000 and I think there is a justification of investigating any sudden large movement / depletion of finances.
Having paid around £500,000 in income tax (plus national insurance on top of that) in the last 28 years, and made reasonable provision for my future, it is blunt lesson in the realities and practicalities a lot of everyday folk, either less fortunate or trapped by consumerist norms have to face.

I think it is fair to say most small woodland owners would be stuffed before finance / savings are taken into consideration.
Years ago a Goth student artist friend did a short dark animation loosely styled on Fritz Lang's Metropolis with the theme 'Consume, Conform, Obey!'
What really grated from when I looked at the form, were certain similarities from recently re-reading various archive documents and history books about The Enclosures Acts and historical common wealth of villagers - time to start brushing up on some of Simon Fairlie's works in http://www.thelandmagazine.org.uk/
I would almost suggest that the form is structured to ensure anybody finding themselves likely to claim benefit at any point would not be in a position to hold land they do not live on.

I can certainly relate to the medical uncertainties as the early progression of my Crohns Disease had most of the symptoms of bowel cancer (and involved the cameras I usually see at work for inspecting inside gas-turbines / handy for wildlife in hollow trees).
It's actually why I took the plunge with the plot compared to holding out longer on choices, but despite rigorous legal and practical preparations before purchase, an area of naïveté has been my personal preparations for sound future robustness and a longer than anticipated interregnum between the retiring company doctor and his replacement messing up the HR chain of events...

Talking of Trusts - 1960s author and passionate landscape historian Alan Garner has http://www.theblackdentrust.org.uk/ which is rather interesting and not far from me.

Assuming I can actually retire to my own plot without being compelled to sell beforehand, I haven't finalised what happens to it yet.
I'm deeply suspicious of leaving anything to public authorities, as financial pressures and unrelated committees ultimately dictate any future of such assets.
Any decent ageing landowner will consider themselves to be a mere 'custodian' rather than owner, leaving things either as they were or slightly improved to the next. (Some aspects of traditional landscape folklore in contemporary settings touch on this).
I also belong to a small educational charitable trust with a few plots (not The Woodland Trust) and it might overlap with their interests.
Because I am more meadow and orchard than woodland, unless I suddenly start procreating (or get a sudden unexpected surprise from any ex), there is the matter of what happens to it. The neighbouring village has a long established non-council allotment trust with a few other beneficial community focussed assets and history society. A traditional orchard near a pleasant riverside path and possibly the site of where Edward The Elder died in battle during a Welsh-Mercian uprising, might be of interest after my own (timely) demise...
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Re: Death and Taxes

Postby oldclaypaws » Tue Feb 18, 2014 11:03 pm

As a student of history, I think I know just where you are Meadowcopse. Great to be near a historic site.
Last edited by oldclaypaws on Wed Feb 19, 2014 10:53 am, edited 1 time in total.
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Re: Death and Taxes

Postby Andy & Heather » Wed Feb 19, 2014 9:11 am

Does anyone have more information about how owning a wood will affect benefits?

From what I understand it is not just ESA that is affected. When the new Universal Credit replaces Child Tax Credits/Working Tax Credit/Carer's Allowance I believe that too will be impacted, which will affect those who are working but in low paid jobs.

Does it make a difference if you are managing the woodland rather than just using it as a place to camp in, etc?
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Re: Death and Taxes

Postby Meadowcopse » Wed Feb 19, 2014 9:44 am

The property aspect (other than where you live) form A64A 04/13 is not woodland specific.
It has a tick-box for 'Land' and asks of its value and if you are making an effort to sell Y/N?
Any and all income (woodland related or not) is declared elsewhere.

I'm not sure if I am eligible for ESA due to savings and probably not if it is savings + land are combined.
https://www.gov.uk/employment-support-allowance/eligibility

I'm hoping I don't need to progress an application to claim, but due to HR / Occupational Health moving slowly regarding a longer term view / alternative, whilst I'm still in the middle of medical / hospital out-patient treatment, being unable to perform my normal work but remaining on the company payroll, but at the end of statutory sick pay (zero pay), I have been advised by HR to apply...

I flagged this topic up, further up the thread due to the likelihood of retirement ages getting later and the implications for people owning land not lived on, who may become ill for longer than 6 months.
I'm sure this is likely to affect a few more people in future.
Out of interest, I am looking elsewhere regarding matters about owning land whilst on low income - changes in allowances could impact on people with low impact but productive lifestyles, especially if a couple with one person requiring care or with children...
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Re: Death and Taxes

Postby Andy & Heather » Wed Feb 19, 2014 10:05 am

Out of interest, I am looking elsewhere regarding matters about owning land whilst on low income - changes in allowances could impact on people with low impact but productive lifestyles, especially if a couple with one person requiring care or with children...


Please post any information you find.
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