Nasty tax surprise
IN the rush to complete tax returns under the new self-assessment rules before Jan 31, farmers have been shocked to find how much they owe.
Besides completing payment for the 1996/97 tax year, money is also due for the first half of the 1997/98 tax year. Both payments are based on the lucrative 1996 crop.
"Unfortunately, the transition year has come at the tail-end of good years," says David Missen of accountant, Larking Gowen.
For the most efficient businesses, there is a way round this. "If you are up-to-date enough to know you have made a loss for the year ended Dec 31, 1997, you can have a carry-back loss claim against your 1996/97 accounts," says Mr Missen.
Any profit can also be reduced through buying machinery to take up the 50% capital allowance. *