Woodland

Woodland

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ok so client has bought a small patch of woodland - the purpose of this was that it came attached to a plot of land they also wanted to buy - they basically bought it to keep the main land deal on course

client incurs a lot of cost with the woodland to maintain it, they've asked the question can they get any tax relief on it - it generates no income and has no plans to

any ideas?

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By User deleted
25th Jan 2016 17:47

Doubt you get tax relief with no income!  May be grants or similar: http://www.forestry.gov.uk/england-grants

 

Why does he "need" to maintain it, as a matter of interest?

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RLI
By lionofludesch
25th Jan 2016 18:30

Memories

You used to elect for Schedule D and claim the losses until it was ready for harvesting and then sold it to someone who paid next to no tax on Schedule B.

It's a lot of years since I did that !!

However, the lack of income doesn't mean that it's not a project without a view to profit.

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Replying to Wanderer:
Out of my mind
By runningmate
25th Jan 2016 18:48

The force is no longer with you

lionofludesch wrote:

You used to elect for Schedule D and claim the losses until it was ready for harvesting and then sold it to someone who paid next to no tax on Schedule B.

It's a lot of years since I did that !!

However, the lack of income doesn't mean that it's not a project without a view to profit.

Methinks the law has been changed since those days in a galaxy far, far, away . . .

RM

P.S.  The last I heard woodlands were exempt from income tax (meaning that no loss relief could be claimed).

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RLI
By lionofludesch
25th Jan 2016 19:04

Changed

I know it changed around 1988 but I can't recall to what.  I don't deal with any woodland owners any more and lost interest in them.

Although, I like walking in them.

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paddle steamer
By DJKL
25th Jan 2016 23:51

Key question, is it commercial forestry? Purpose test?

Commercial forestry ( land/ standing timber timber held for forestry purposes)  does tend to fall outwith tax. However it really depends why your client holds the land- examine the purpose.

We had a substantial area of ground (196 acres) for which we obtained planning, part of the planning conditions required us to plant a substantial number of trees (mixed native broadleafs in the main), in our case 15,000/ 20,000 were planted as screening and we did a  further replanting for die back in 2015, the main legislative reason was so that the development site would not be visible from a road and the planting was stipulated as a reserved matter. ( Full tree survey of existing trees with each existing noteworthy tree documented, all done before planting the additional trees)

In this instance I considered that our motive was not commercial forestry and treated the costs incurred as augmenting the carrying stock cost of the land, accordingly when we sold the land the planting costs were relieved against the sale proceeds (or will be as I will report  the profit in 2015/2016)

Here we had no intent to run commercial forestry, the planting was not done for a forestry purpose and the woodland in 50-100 years  (broadleafs tend to be slow maturing) is not intended to be felled for timber- well I hope not, it is intended to create a native Scottish woodland to be enjoyed.

The planting  will also be for decorative purposes to create a common parkland area for the development. Some of the planting is within the individual plot boundaries but most is in ground that will be owned in common by all the house owners, and run and maintained by a Residents Association.

This link to Scottish Woodland outlines tax implications re forestry and is an interesting read

http://www.scottishwoodlands.co.uk/assets/pdf/forestry_taxation_summary.pdf

 

 

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avatar
By waltere
27th Jan 2016 16:39

Install a wood burner

Is the woodland close to the house (the post makes it sound as if it might be).  If so, they could install a wood burner and at least then they would have some "free" fuel.  

You do not need a felling licence for "Up to 5 cubic metres of wood in any calendar quarter, as long as no more than two cubic metres are sold. Five cubic metres is roughly equivalent to one large oak tree or 50 thin chestnut coppice trees."   Of course, you do need a chain saw and all the proper protective clothing.  But imagine the warm glow they'll get sitting in front of a roaring log fire... especially since they won't be paying those money-grabbing utility companies!

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Replying to Justin Bryant:
paddle steamer
By DJKL
27th Jan 2016 21:05

Sounds more pleasant than the reality

waltere wrote:

Is the woodland close to the house (the post makes it sound as if it might be).  If so, they could install a wood burner and at least then they would have some "free" fuel.  

You do not need a felling licence for "Up to 5 cubic metres of wood in any calendar quarter, as long as no more than two cubic metres are sold. Five cubic metres is roughly equivalent to one large oak tree or 50 thin chestnut coppice trees."   Of course, you do need a chain saw and all the proper protective clothing.  But imagine the warm glow they'll get sitting in front of a roaring log fire... especially since they won't be paying those money-grabbing utility companies!

Sounds more pleasant than the reality, every year I fell a few trees at the back of our holiday house in Sweden (see picture) debranch, cut into 8 ft lengths and stack. These are then swapped with a neighbour for birch, as most of my trees are spruce/pine and spit a bit in an open fire. After swap I then have to use chainsaw to cut the lengths into circa 15 inch logs, splitter to crack them apart and then stack them in the stage one drying shed. Next holiday (yes, a holiday,but if not doing this I always seem to be painting things with red paint so strange holiday) I move the dried logs to the  stage two store (those for use) and repeat the process.

Whilst cutting down the trees is good fun (very satisfying when they fall where you intended, not so good if they decide to choose where they land) the rest is pretty back breaking for someone who spends most of the rest of the year stuck at a computer.

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Replying to Justin Bryant:
RLI
By lionofludesch
28th Jan 2016 08:27

Disgraceful !!

waltere wrote:

Is the woodland close to the house (the post makes it sound as if it might be).  If so, they could install a wood burner and at least then they would have some "free" fuel.  

You do not need a felling licence for "Up to 5 cubic metres of wood in any calendar quarter, as long as no more than two cubic metres are sold. Five cubic metres is roughly equivalent to one large oak tree or 50 thin chestnut coppice trees."   Of course, you do need a chain saw and all the proper protective clothing.  But imagine the warm glow they'll get sitting in front of a roaring log fire... especially since they won't be paying those money-grabbing utility companies!

Have you not heard of global warming ????

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Portia profile image
By Portia Nina Levin
28th Jan 2016 10:28

There is not a frigging house, so it is irrelevant. Who mentioned a frigging house?

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