Do I need planning permission?
In most cases, yes, says Wilts-based consultant Tony Kernon.
Horses are not agricultural animals and the keeping of horses requires a change of use of the buildings.
Unless the land is used only for grazing, it will require change-of-use consent too.
Permission for the change of use of buildings, especially where it forms part of a farm diversification, is generally relatively easy to obtain.
How much capital will I need?
“Shop around and don’t overspend,” says Mr Kernon.
“In the long run, keeping a yard neat and tidy probably increases the amount people will pay more than providing particularly expensive stables.
“If you are building from scratch, assuming you are going to include a concrete floor, costs will start from about 2000 a stable.
You may be able to do it cheaper if you are doing the work yourself.
“For building re-use there are many suppliers of internal partitions at anything from 600 a stable upwards.
For these to work you need a building with little more than a concrete floor and solid walls.
You also need to consider a secure tack room, a feed room (and for DIY livery possibly a separate store for each owner).
Can I get a grant?
Definitive answers to this question are tricky, says Richard Bacon, lecturer in equine business management at Warwickshire College.
“Livery can be eligible for grants under the DEFRA Rural Enterprise Scheme.
Other grants may be available locally.”
Should I run the livery separate from the farm business?
This will depend on individual circumstances; get some advice from your accountant — there could be VAT and partnership issues, says Mr Bacon.
Often DIY livery is run within the farm business, but it is wise to at least keep separate costings.”
Should I have a contract?
“You should have a detailed livery contract covering what you are offering and what is included, payment terms, conduct of horse owners, their horse management and their use of and attitude to your property.
The BHS has a model contract.”
Do I have to be licensed?
Not yet, but this is expected to come in as secondary legislation under the Animal Welfare Bill, with Local Authorities and a vet inspecting and licensing in future.
This could be two years or more down the line, says DEFRA.
In the meantime, the BHS has an approvals scheme (currently covering 250 livery yards) which costs 300 for inspection and registration initially and then 200 a year after that.
Will I have to pay business rates?
However, there is usually 50% rate relief for new farm diversification businesses with a rateable value of 6000 or lower for five years.
What about security?
“This is important not just for horses but also tack and trailers, which are all key targets,” says Mr Bacon.
“Exits must also be secure in case of horses escaping.”
Any veterinary medicines being stored on site must be secure.
Will I have to change my insurance cover?
Yes – farm insurance covers you only for agricultural activities.
Your insurer may not charge extra to cover your livery business but you must inform them of any change in activity such as this.
Other insurers may be willing to cover the livery as a standalone policy, but this could be more costly, says Bob Pluck of South Essex Insurance Brokers, South Ockenden.
He recommends at least 2m of public liability cover for DIY livery businesses.
He also cautions against relying on horse owners to insure their animals for public liability.
How much competition is there?
Mr Bacon reckons there are about 3500 livery yards in the UK, maybe more.
“From what we see and hear, the number is increasing, with the consequence that yards are now having to compete more for business.
This usually means offering better facilities, rather than price wars.”
How much should I charge?
Mr Bacon’s research for his most recent book (see advice panel, right) shows that livery fees vary widely:
Will my SFP be affected?
“Yes — though this is a slightly grey area,” says Mark Juniper of Strutt & Parker’s Newbury office.
“While the grazing of horses constitutes an agricultural activity that is permitted on land eligible for single farm payment, dedicated DIY livery use is likely to be regarded as non-agricultural.
“So the land used should be excluded from your SFP claim to guard against any deductions or unnecessary delays.”
What about health and safety?
“Health and safety should be considered not only in relation to horse owners but also other people on the farm such as employees or contractors.
I would advise any landowner considering DIY livery to look at health and safety matters in great detail before deciding to press ahead.
What else should I consider?
“Think about some of the longer term issues — how will the capital value of your property be affected by a busy yard where people are coming and going all the time?”
says Mr Juniper.
“Also, taking assets out of agricultural use means that they will no longer qualify for agricultural property relief from IHT, although they may be eligible for business property relief.”
“Farm owners should also give serious thought as to how waste from the livery enterprise will be disposed of.
Although not affected by the recently introduced Waste Management Licensing Regulations 2005, horse manure continues to be considered as controlled waste under the 1994 Waste Management Regulations.”