Farming Investment Fund
At the end of November 2021, DEFRA launched the ‘Farming Investment Fund’. This scheme is broken into two parts:
1) The Farming Equipment and Technology Fund (FETF) £2,000 – £25,000
The fund is based on the old countryside productivity grant scheme and has 120 specified pieces of equipment covering all agricultural sectors including horticulture and forestry. The minimum grant has been reduced from £3,000 to £2,000 and contractors have now been added to the list of eligible candidates in a bid to make the grant more accessible to a wider number of applicants.
The deadline for applications is 7 January 2022.
2) The Farming Transformation Fund (FTF) £35,000 – £500,000
The second part of the fund is for larger projects and is specifically for Water Management Schemes on farms such as irrigation and reservoirs. Grants can cover up to 40% of the eligible costs of a project, therefore the minimum total eligible cost of a project would be £87,500.
DEFRA have created an online checker for the Farming Transformation Fund to determine eligibility and the likelihood of success before an application is submitted.
The deadline for applications for Water Management FTF applications is 12 January 2022.
DEFRA have confirmed that they will be launching a second round of the FTF in the new year designed for projects that will be ‘adding value and improving farm productivity’.
Since these grants are for capital items they will not be treated as revenue income. For tax purposes, the grant will be offset against the full capital cost for the equipment/project for which you may be entitled to either capital allowances in the form of Annual Investment Allowance, Super Deduction or Writing Down Allowances.
Please do not hesitate to contact your adviser if you have any queries on the new Farm Investment Fund.