Agricultural small holding vat and domestic rent

Forum Categories GENERAL VAT DISCUSSIONS Agricultural small holding vat and domestic rent

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    I have just noticed something on my mothers rent statement that made me question if something was legal or right.

    My mother has rented a small holding with 9 acres of land and a old cob cottage for 35 years. When moving in the outgoing tenant sold improvements he made to what was once a derelict property to my parents for £5000 in 1983. The basis was that the rent was thereafter a peppercorn rent and hence the investment in paying for the house improvements.

    Over the years new land agents have argued that the price of the rent was not fair and so it should be put up.

    I am trying to keep this short to get to the point. The rent is paid for 6 monthly and in the breakdown we have noticed something odd. There is an agricultural element of rent which is £2970+vat and then agricultural rent (non vatable element) which is £330 bi annually. There is domestic insurance of £213 p.a

    I had a thought that the non vatable element is the farmhouse rent and the £2970+vat bi-annually is for the 9 acres of land.

    The land is quite literally not fit for farming, it has a gradient that runs across the whole land, like what it would look to be on the side of a valley. We have been told that the huge estate owner claims back the VAT on the rent of this property. It would appear that the rent has been increased way beyond its agricultural value, potentially in my view to be able to reclaim the vat back.

    The land owner is a lord and one of the biggest I believe in the country.

    I appreciate this may not be the exact forum to post this in, but would appreciate if anyone can point me in the right direction from experience.

    Kind regards


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