Guidance

Managing a successful Rural Payments Agency grant project

Updated 9 April 2025

Applies to England

This guidance is for successful applicants who have been awarded one of the following grants:

• Adding Value
• Calf Housing for Health and Welfare
• Improving Farm Productivity
• Smaller Abattoir Fund
• Water Management
• Slurry Infrastructure
• Water Restoration Fund

It explains the steps you must follow to comply with the funding rules for your grant.

About your Grant Funding Agreement

Your Grant Funding Agreement (GFA) is the legally binding agreement between the agreement holder and the Rural Payments Agency (RPA). It contains:

• Part 1: agreement letter and annexes
• Part 2: terms and conditions

When you receive your Grant Funding Agreement (GFA), you must sign and return it. We will email you to confirm we have received it.

You must only start project works (this includes purchasing any materials) on or after the GFA start date. We will not pay for materials, paid deposits and work done before this date.

The table below explains some terms used in the grant funding application process.

Term used	Definition
The applicant	the person who applies for the grant.
The agreement holder	the person in overall control of the project and who takes responsibility for meeting the scheme rules. In most cases, the agreement holder is the single point of contact for the project.
The project management team	the RPA team you contact for your project. Their contact details are in your GFA.
The agreement	the legally binding grant funding agreement between the agreement holder and RPA.

Your agreement letter and annexes in Part 1 include:

• the total expenditure which is eligible for grant funding, a list of items eligible for grant funding and the grant rate (%)
• details of your grant claims by date and amount, based on the information in your application
• the outputs which your project should achieve and any special conditions you must meet

You must meet the terms and conditions in Part 2 as a condition of receiving the grant.

You should read both parts of your agreement carefully and in full, so that you understand your legal rights and responsibilities under the agreement.

If you need more information about your agreement or it appears that your project is not on track to meet conditions, outputs, or financial profile, you should contact your project management team as soon as possible.

How VAT is handled

Your GFA tells you how VAT will be handled in the project. This is based on the information you gave in your application. If your VAT status changes within the period of the contract, you must tell us straight away as it may affect your grant payments.

Agreement holders are fully responsible for their own VAT affairs.

How tax is handled

Grant payments are subject to normal UK tax rules, so you may need to tell HMRC about this grant. For more information, speak with your accountant or read the Specific receipts: grants and subsidies guidance on GOV.UK.

Your Single Business Identifier (SBI)

We use the SBI you registered your business against to pay your claims. You must make sure that your business bank details are also registered with us, or your claim payment will be delayed. If you need to check that we have your correct business bank details, sign in to the Rural Payments service and select ‘view and amend bank details’ on the business overview page.

Supplier quotes

Your grant is calculated on the value of the cheapest supplier quote submitted. You can use a more expensive supplier quote but will have to fund the difference in cost yourself. If you want to use a quote or supplier which is different to those submitted as part of your application, you must ensure they are not a supplier or manufacturer who you or your business are part of or linked to in any way.

For Slurry Infrastructure grants only

We use reference costs to work out the maximum amount of grant you could receive. As no quotes have been submitted, you can use a supplier of your choice, but you must ensure they are not a supplier or manufacturer who you or your business are part of or linked to in any way.

Submitting claims

You should follow the claims schedule in Part 1 of your agreement to submit claims.

When to make a claim

You can submit a claim earlier than the scheduled date.

If you think there will be a delay in submitting any claims, you must discuss this with us as soon as possible. In some circumstances we may agree to a written request to delay the timing of your claim.

For Water Restoration Fund grants

You should follow the claim schedule in Annex 2 of your agreement.

How to make a claim

You will receive a claim form which must be completed by the person who signed the agreement or someone who has permission to ‘Make legal changes’ or ‘Full permissions’ for the business in the Rural Payments service.

You must keep accurate records and evidence to support all project expenditure you claim grant on. You need to collect and keep evidence of the project outputs and conditions met and submit copies of this information with your grant claims and progress reports.

Eligible expenditure:

• contributes directly to the operation and delivery of the project
• is listed in Part 1 of your agreement
• is exclusively for the project
• is incurred after the project start date
• is for items which have been fully paid for by the agreement holder business and evidence is provided with the claim, for example, the business bank statement

We will not accept payments if they are made from personal accounts or a different business account.

For Water Restoration Fund grants

Eligible expenditure is listed in Annexes 1 and 3 of your agreement.

Evidence to support your claim

You must provide the following documents to support your claim.

Invoices

You must include invoices that:

• are addressed to the same person or business as detailed in the GFA
• show the supplier’s name, address, telephone number, VAT number and date
• fully describe the work done and cost of each item, or describes each section of work separately

If an invoice was emailed to you from a supplier, you should forward the original email with the invoice attached.

For Slurry Infrastructure grants only

Invoices should include detail such as working capacity (m3) of the store, what material covers are made of, the surface area covered (m2), and confirmation that any British Standards in item specifications are met.

If your invoice is for a deposit or staged payment, you must also include a quote or schedule of works that cost out each item and describe the works.

Second hand items

If you have agreement to purchase second hand items, you must include confirmation from your supplier confirming the following points:

• the origin of the item and if possible, confirmation that during the previous 5 years the item has not been purchased with public funding
• the item meets health and safety legislation
• the item does not cost more than the market value for new equipment
• the item is operational and fit for the purpose of the project as described to them by the agreement holder

Second hand items do not apply to Water Restoration Fund grants.

Bank statements

You must submit original or true copies of business bank statements showing the invoice payment being made and the cheque number of the payment, if applicable.

You can submit screenshots from an online account showing payment details and bank logos, or a certified report printed from a banking system. We cannot accept edited bank statements.

If payment has been made by cheque, a photograph of the cheque book stub is required to confirm the payee.

Bank statements should include the:

• bank’s name and logo
• account holder’s name in full
• account number / IBAN number
• transaction date
• transaction type (including payee ref and cheque number)
• transaction amount
• date bank evidence generated

BACS payments

For BACS payments, you must provide the full audit trail including the report that details all the invoices in the BACS payment. Only send the invoices that relate to the claim.

For Water Restoration Fund grants only

You need to provide payslips and timesheets to confirm staff costs. Payslips should be redacted to show the payees name, the amount paid to them and should only show time and costs associated with the project. Timesheets must be signed off by a treasurer, payroll manager or finance head.

Credit card purchases

For items purchased by credit cards, you need to show that the item has been purchased in full by a credit card linked to the agreement holder business. If you use any other credit card, you must provide evidence to show that the item is transferred to the ownership of the agreement holder before a claim is made.

Deposits

You can only claim for deposits on items that you have discussed and agreed with us in advance. These deposits should not be more than 40% of the value of the item and will be paid at the GFA grant rate, not in full.

Multiple invoices or payments

Where an invoice includes several items but not all are eligible, you must explain which items you intend to claim for on that invoice. We will only pay grants for these eligible items. Invoices must be paid in full.

If you’ve made a payment to a supplier that covers more than one invoice, you need to provide copies of all the invoices included in the payment. Alternatively, you could provide a copy of your account summary or statement from your supplier but it must include invoice numbers and amounts paid.

Payments in any other currency

If your claim includes payments made in any currency other than pound (£) sterling, you will need to convert these to pound (£) sterling on your claim form using the exchange rate on the date the invoice was paid. Find the exchange rate using HMRC exchange rates on GOV.UK.

If the exchange rate on the day the invoice was paid means you have paid less than the cost listed in part 1 of your agreement, this is the amount you are eligible to claim. If the exchange rate on the day the invoice was paid means you have paid more than the cost listed in part 1 of your agreement, you can only claim grant up to the amount offered in pound (£) sterling in your agreement for the work or item.

Cash payments

You must not make cash payments for any items you wish to claim grant for. We will reject all cash payments included in your grant claim.

Asset register

The asset register records capital assets bought as part of the project. You should keep the register for a minimum of 5 years from the final payment date and submit a copy with your final claim submission.

Record keeping

You need to keep a full record of project progress and collect evidence of the outputs and conditions achieved. You need to send this information with grant claims.

How we process your claim

We will check your claim form and supporting evidence and may need to ask you for more information to support your claim.

We aim to pay complete claims within 30 working days. You should account for this as it may affect the cash flow of your project or business. Claims that are incomplete or need a site visit may take longer to process.

For projects with more than one claim, we will make the final payment once the project is both financially and physically complete. The final payment will be for at least 15% of your total grant.

You must follow the payment profile set out in your agreement and make sure that the minimum claim value is not less than £2,000. You must not claim more than 85% of your grant before the final claim. If you claim more than the amount profiled for each budget heading, or for each claim, we will reprofile your remaining claims or reduce your grant accordingly.

For Slurry Infrastructure grants only

You must follow the payment profile set out in your agreement and make sure that the minimum claim value is not less than £2,000. You must not claim more than 75% of your grant before the final claim. If you claim more than the amount profiled for each budget heading, or for each claim, we will reprofile your remaining claims or reduce your grant accordingly.

For projects with more than one claim, we will make the final payment once the project is both financially and physically complete. For Slurry Infrastructure grants this will be 25% of your total grant.

We will adjust your claim amount if invoiced costs are less than referenced costs.

For Water Restoration Fund grants only

If an advance payment has been approved, we will send you a ‘WRF advanced payment costs and items’ form to complete. You will need to send evidence of these costs before you submit your first claim form, as we won’t be able to process your claim without it. You will also need to send evidence of these costs with your first claim form.

You must not claim more than 85% of your grant before the final claim. If you claim more than the amount profiled for each budget heading, or for each claim, we will reprofile your remaining claims or reduce your grant accordingly.

If you have any other queries when preparing your claim, please contact us for advice.

Errors and late claims

If you make a mistake, you can resubmit your claim form if we have not already told you about the error. If you have any questions or concerns about completing the claim form, please contact us before you submit your claim.

We will work out the claim payment on eligible items in the claim. If there are errors, we will remove any ineligible amounts from the claim.

If your claim does not reach us on time, is incomplete or not in accordance with the scheme rules and guidance, we may withhold your payment or ask you to repay any monies we have already paid to you.

Agreement holder progress reports

You must start the grant funded project within 3 months of the start date shown on your agreement. You must discuss any delay in the start date with us as soon as possible. In some circumstances we may agree to a written request to change the start date.

You must complete progress reports and provide evidence of the outputs and conditions met for the duration of the GFA.

Report a change of circumstance

If any change of circumstances affects your project or GFA, you must notify us as soon as possible and request a variation to your contract. You should do this before the change takes place as it could affect your grant payments, or result in recovery of funds. 

You must notify RPA before:

• making any changes in the ownership of the business that applied for grant aid
• making any changes in the ownership of the grant aided items
• the business or grant aided enterprise or activity ceases trading or fundamentally changes the nature of its activities
• any grant aided assets are sold, become redundant, or cease to be used for the purpose for which they were grant aided
• granting any legal charge over any land or other asset funded in whole or in part by the grant

For Slurry Infrastructure grants

In addition, if you want to alter your design in any way, you must notify us and request a variation as soon as possible. It is possible that your request may need to be referred to the Environment Agency for consideration, and we will contact them if required.

We will write to you to confirm any changes to your agreement.

In some cases, we may need more information before we make a decision. For example, if you want to purchase a piece of equipment that is different to the one you included in your application, you will need to:

• submit new quotes confirming the piece of equipment is of the same specification or higher
• confirm that your design does not require any alteration as a result of the change
• confirm that your outputs will still be met with the different piece of equipment

You must receive written consent from us before you make any changes. In some cases, you will receive a ‘variation acknowledgment’ from us. You must complete the form and return it to us.

We may refuse to pay your claim, or reclaim payments, if:

• you make changes without written consent
• there is a change of circumstance that affects the progress of the project
• you do not comply with the grant agreement
• you’re not entitled to the payment

You must continue to notify us of any project changes for 5 years after the date of your final grant payment.

Good reasons for a breach of agreement

This section does not apply to Water Restoration Fund projects.

You may be unable to meet your requirements under your agreement or project delivery is affected because of exceptional circumstances. If this happens, you must write to tell us within 8 weeks of the event. You will need to provide evidence in writing to show:

• what has happened
• how the event meant you were unable to meet the terms of your agreement

Good reasons for a breach may include, but are not limited to:

• natural events, such as prolonged adverse weather conditions, flooding, or animal or plant disease
• serious illness of an agreement holder
• the death of an agreement holder
• unforeseen loss of management control of land, for example when a tenancy is terminated, or because of the compulsory purchase of land by a third party
• financial circumstances, such as bankruptcy
• supply chain problems - you must provide evidence of this
• criminal damage by a third party, such as arson or vandalism

If you’re aware of the issue when entering into your agreement, it is unlikely to be considered as a good reason for a breach.

You should explain the circumstances of your case and include any documentary evidence to support this.

For Water Restoration Fund projects, please contact us as soon as possible if any changes are needed to your project.

What happens if you breach your agreement

If you do not meet the terms of your agreement, we may reduce or withhold your payment or ask you to repay any monies we have already paid to you. 

If we find a breach, we will write to you to tell you. You’ll have the opportunity to appeal if you do not agree with our findings.

Record keeping and site visits

The agreement holder must keep all project records for at least 7 years from the date of the final payment of grant. This includes invoices, receipts and bank statements and information related to project outputs.

Defra, RPA, or an organisation appointed by them, may complete a site visit during the lifetime of the project to:

• track expenditure through your records and bank statements
• check all grant funded buildings and equipment
• check evidence of any outputs created
• interview the person who has managed the project
• check staff records, if appropriate

Post-payment monitoring

When your project is complete and all grant payments have been made, you may need to complete a post-payment monitoring report. We will send you a template to provide updates on your project outputs or project specific conditions. This is your opportunity to tell us how your project is progressing against the outputs agreed in your agreement.

For Water Restoration Fund projects only

Please read your Grant Funding Agreement, section 6: Monitoring and reporting.

Publicity requirements

You need to follow RPA guidance about acknowledgement and publicity of the grant. This includes using templates or materials if provided. It may also include a statement on the agreement holder’s business website or you may need to display a poster, plaque or billboard on your land or premises.

For Water Restoration Fund Development awards, you should submit a final project report to RPA. The report should show ‘Funded by UK government’ branding on the front cover page to acknowledge the Water Restoration Fund grant.

Making a complaint

If you’re unhappy with a decision or with the service provided by RPA, read our complaints procedure on GOV.UK.