Farmers Weekly’s business expert Andrew Wraith explains how holding a festival on your land could affect BPS claims.
Q: I have agreed to host a festival event on my land in summer 2015. The organisers will need to be on the main event area for more than a month to set up and take away. Will this affect my BPS claim in 2015?
A: The 2015 claim year is an important one in terms of establishing the total number of payment entitlements allocated to a business. Entitlements can only be established on eligible land. From the question, if the non-agricultural activity takes place on the land for more than 28 days in aggregate over the calendar year, then it would not be eligible land.
This is important in 2015 because it would mean no allocation of entitlements for the affected area despite the fact that, assuming this is a one-off event, in future years the land would be eligible.
Anyone establishing entitlements in 2015 but unable to use in 2016 due to the same circumstances will not have a problem as, once established, the two-year usage rule will apply, so this is very much a 2015 claim year problem.
The same principle applies to land affected by pipeline or other utilities work, where land is temporarily ineligible and a claim for force majeure is not accepted since the project was planned. This is probably a more common problem for claimants than those affected by the 28-day land usage rules.
One remedy is to negotiate compensation to cover purchase of entitlements foregone in 2015 to ensure future BPS income streams are protected, although we understand that further representations are being made to the RPA.
Alternatively, you could try to negotiate with the organisers to bring the overall schedule down to less than 28 days.
These issues should also be considered by anyone with a temporary activity on their land where it is not planned for the activity to run for more than 28 days but if the schedule slips, a BPS claimant could find he/she has inadvertently lost out on entitlements.
The information provided in these articles does not constitute definitive professional advice and is provided for general information purposes only.
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