Tax Efficient Buying

A J Rimmer

Member
Mixed Farmer
Location
South West
I've been asked a question that I can't quite answer properly.

Is it better to rent or buy a farm in terms of tax efficiency? I've always thought buy (if possible) for obvious reasons, but is it sensible tax wise? ie Rental payments can be written off as an expense but mortgage/loan payments aren't....does that potentially lead to a double whammy of paying out and also then having tax to pay making everything unviable? I got myself in a right pickle trying to explain and am now totally confused.

Anyone got a simple explanation?
 

teslacoils

Member
Location
Lincolnshire
Depends if you think capital repayments on land are better than investing the same money elsewhere.

Depemds if you like the flexibility to walk away, or like the idea of staying put for 20+ years.
 
If you pay tax then you’ve generally got something to show for it!
If you don’t pay much tax you generally don’t have much to show for it.
Your answer is in your question
 

silverfox

Member
Location
Shropshire
Depends if you see owning land as the be all and end all. Might be better renting a good sized farm with good land than owning a smaller, poor farm.
profits from the better farm can buy other investments , houses or even more land .
 

farmerdan7618

Member
Livestock Farmer
Location
Somerset
Buy in a pension fund, then rent it off that. Very tax efficient, but wouldn't suit everyone.

Otherwise, little difference in it really, depends more on the earnings potential of the farm.
 
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