BIM55115 - Farming in tax law: all farming by same person treated as one trade

All the farming carried on in the United Kingdom by a particular person (or partnership, or body of persons) should be treated as a single trade. (But, where an individual carries on farming activities both as a sole trader and as a partner, or as a member of two different partnerships, the separate activities are treated as separate trades.) The profits of a person who carries on farming activities, in the same capacity, at more than one farm should be computed in a single sum.

A person who-

• removes from one farm to another without an interval, or
• gives up a portion of his land, or
• takes over additional land (whether or not he or she succeeds to the trade of his predecessor on that land)

is therefore chargeable on the basis of a continuing trade notwithstanding the change (see Bispham v Eardiston Farming Co (1919) Ltd [1962] 40TC322).

Where there is an interval between the discontinuance at one farm and commencement at another, the farming should be treated as discontinued and a new trade as having commenced only where the facts support the conclusion that there was a permanent discontinuance of the original trade (see BIM70500 onwards).