The application window for the Lump Sum Exit Scheme closes on 30 September 2022.
Last year, as part of the Agricultural Transition programme, Defra consulted on the administration of direct payments and a lump sum exit payment for farmers who may be looking to leave the industry. The intention behind the lump sum scheme is to make it easier for farmers who wish to retire or leave the industry to do so, thereby freeing up land for new entrants or existing farmers keen to expand their enterprises. The scheme is a one-off opportunity to receive a lump sum payment based on remaining Basic Payment Scheme (BPS) claims in return for leaving farming.
The key condition is that the recipient of the payment has to surrender all of their BPS entitlements and cease farming the associated land. Other than the ability to retain up to 5 hectares, all agricultural land needs to be given up by way of sale, gift or tenancies. If you farm under a tenancy, this will need to be surrendered or assigned to be eligible for the lump sum.
Lump sum payments will be made from November 2022 for those that have already exited by then. Otherwise, applicants will have until 31 May 2024 to submit and finalise their claim. Under the scheme, once a lump sum payment is made, you will no longer be eligible for BPS payments or delinked payments (which will begin in 2024) in England. If you are a farmer considering retirement and the future of your business, please get in touch with a member of our Agricultural and Rural team. We can advise on agricultural property and succession planning and will work with your accountant and land agent to ensure the best possible outcomes for you as an individual or partnership.
As an Associate Solicitor, Kate Wilson is an experienced member of the agricultural and rural property team at Tinsdills. Kate specialises in all aspects of commercial and agricultural property work, from farm and land sales and purchases, to agricultural tenancies and licences, residential and commercial development to options and conditional agreements plus everything in between.
The purchase of agricultural property at auction is often a swift process. However, the auction process is one that should also be met with caution. If your bid is successful, you will be required to sign the contract and pay deposit of 10% of the purchase price at the auction. You will then be contractually bound to complete your purchase on a fixed completion date, which is generally 28 days following the auction.
What should I do prior to the auction?
If you have identified a property that you wish to bid on at auction, researching this property is important. The seller will have prepared a legal pack for the property, containing the title documents, often conveyancing searches and any special conditions of sale. This pack should be reviewed in detail. Tinsdills can review this pack prior to the auction, to advise you of any potential legal issues or further enquiries and investigations that may be appropriate.
Following the review of the legal pack, if you decide that you wish to bid on the property, you should ensure that you have the appropriate finance arrangements in place, both to pay the deposit at auction and in readiness to pay the remaining balance on the completion date.
At the auction
At the auction, in addition to having available funds to pay the deposit immediately, you should be prepared to provide evidence of your identification, particularly if your bid is successful. I was successful with my purchase at auction, what should I do now?
If you purchased a property at auction, you will then need to formally instruct a solicitor to act for you in order to complete your purchase. Tinsdills’ highly experienced agricultural property team are happy to act for you in the completion of your auction purchase.
Tinsdills will take your purchase through to completion and deal with the registration of the property at Land Registry on your behalf.
Selling Agricultural Property at Auction
The sale of agricultural property at auction is a popular choice for sellers. If your property sells at auction, the overall process is swift, with the buyer paying a deposit of 10% of the purchase price at the auction and being contractually bound to complete their purchase of the property on the fixed completion date, usually 28 days following the auction.
What should I do prior to the auction?
If you wish to sell agricultural property at auction, you will firstly need to instruct an auctioneer. The auctioneer will generally agree a guide price with you, advertise the property and enter the property into auction.
You should then instruct a solicitor to prepare an auction legal pack. This pack will be made available to interested buyers, allowing them to review key information about the property, such as title deeds, conveyancing searches and any special conditions of sale. Interested buyers may raise enquiries on the documents contained within the legal pack, which your instructed solicitor will answer.
Your solicitor will also arrange for you to sign a copy of the sale contract prior to the auction date.
Tinsdills’ agricultural property team are experienced in auction sales and are happy to act on your behalf for a sale at auction, from preparing the auction legal pack through to completion of a sale of the property.
What happens at the auction?
A member of Tinsdills will be present at the auction. If the sale of your property is successful, the buyer will pay the deposit of 10% of the purchase price, which will then be held by your solicitor until completion takes place. Contracts will be exchanged in readiness for completion to take place on the fixed completion date.
I was successful with my sale at auction, what happens now? Tinsdills will contact the solicitors instructed to act for the buyer and provide them with a copy of the legal pack. Tinsdills will then undertake all work required to complete the sale.
Contact us If you would like to discuss the sale or purchase of an auction property, please do not hesitate to contact Tinsdills’ highly experienced Agricultural Property department who will be happy to assist you.
First Registration is the process by which property that is not registered with HM Land Registry (“the Land Registry”) becomes registered. When registered, the Land Registry assigns a specific ‘title number’ to the property, prepares a plan of the property and then maintains a record of future ownership changes, overages, mortgages, easements, or leases.
When must property be registered?
All unregistered property must be registered with the Land Registry in the following circumstances:-
A purchase of property;
Property being transferred by way of a gift or inheritance;
Property being exchanged for other property;
Leasehold property being transferred (that generally has more than 7 years left on the term of the leasehold at the time of the transfer);
On the grant of a new leasehold (generally where the term is for more than 7 years from the date of grant); and
The creation of a first legal mortgage (one that ranks in priority ahead of any other mortgages affecting the same property).
Tinsdills will deal with any compulsory registrations if they are part of a matter that we are instructed to act in.
Voluntary First Registration
If unregistered property is in your ownership, you can choose to register such property with the Land Registry voluntarily, even if you are not selling, transferring, or otherwise having dealings with the property. Tinsdills can review the deeds to the property that you wish to register with the Land Registry and apply for voluntary first registration on your behalf.
Benefits of voluntary first registration:-
Registration will provide you with documented proof of ownership of the property, with a plan displaying your registered property boundaries.
The title plan provides clarity in the extent of your property and may reduce the chance of any ambiguity or future boundary disputes;
The Land Registry will assign a class of title to the property, which is guaranteed by the government;
Selling or transferring property is generally a more straight forward process when the property is registered. This is because registered land is usually less time consuming to deal with, as opposed to original title deeds, which are generally rather lengthy and require a thorough review;
Registration can protect your property against fraud. Once the property is registered, you will be able to set up a Land Registry Property Alert, which would notify you should someone try to alter the register to your property, such as if someone tried to fraudulently register a mortgage against or transfer your property;
Once registered, there will be no need to safely and securely store the unregistered title deeds and documents as the Land Registry will take and retain copies;
Copies of title deeds and documents can be requested from the Land Registry easily and at very little cost. Most deeds and documents can be requested and sent electronically;
The Land Registry offer a discounted fee for voluntary first registration applications.
What is required to register property?
Tinsdills property team are experienced in registering unregistered property and we will deal with the process on your behalf from start to finish.
We will require all of the title deeds that you hold for the property, allowing us to conduct a thorough review of these deeds prior to registration with the Land Registry. We will also require a scale plan of the property to be registered, if one is not contained within the title deeds.
We will then make the necessary enquiries with the Land Registry and submit the application for registration. Once the property is registered, we will review the registered title to ensure all necessary rights, easements or otherwise are recorded on the registered title accurately and then provide you with the title documents provided by the Land Registry for your records.
What if the Title Deeds have been lost or destroyed?
You can still apply to the Land Registry for voluntary first registration of a property if the title deeds have been lost or destroyed. The Land Registry will require a Statement of Truth from the person claiming ownership of the property, giving a full account of the events that led to the loss or destruction of the title deeds, along with any other documents relating to the title of the property that you may have. Other parties who may have had possession of the deeds, such as a conveyancer or bank/building society can also prepare corresponding Statements of Truth, to be used as further evidence when submitting your application to the Land Registry.
The Land Registry will review the application and decide whether to grant ownership of title based on the Statements and documents presented to them.
Tinsdills can review individual cases where title deeds have been lost or destroyed and prepare the Statement of Truth and application on your behalf. We will then submit the application for registration to the Land Registry and correspond with the Land Registry until the application is decided.
Contact us
If you would like to discuss the registration of unregistered property, please do not hesitate to contact Tinsdills highly experienced Property department who will be happy to assist you.
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