Guidance

Delinked payments: replacing the Basic Payment Scheme

Find out if you’re eligible for delinked payments, how they’re calculated and when you’ll receive them.

Applies to England

The Rural Payments Agency (RPA) will replace the Basic Payment Scheme (BPS) in England with delinked payments in 2024. The 2023 scheme year was the last year of BPS.

The delinked payments scheme rules are set out in new regulations which have been approved by Parliament and came into force on 1 January 2024.

You will not need any land or entitlements to receive delinked payments.

RPA will pay delinked payments each year from 2024 to 2027. The amount you receive will decrease each year as we apply progressive reductions. This is explained in ‘How delinked payments are calculated’. 2027 will be the last year of delinked payments.

Check if you’re eligible for delinked payments

To receive delinked payments, you must:

  • be eligible - this means you must have claimed, and been eligible for, BPS payments in England in the 2023 scheme year (except for some inherited land). Read the BPS rules for 2023 for information about eligibility for BPS
  • have a reference amount

Your reference amount will normally be your average BPS payment in the reference period, which is the BPS 2020 to 2022 scheme years. If you did not claim BPS in the reference period, you will only have a reference amount if BPS reference data has been transferred to you.

Your BPS 2023 claim does not need to have been for the same amount of land, or for land in the same part of England, as you claimed in the reference period.

Your BPS 2023 claim needed to be for at least 5 eligible hectares, with 5 BPS entitlements in the same BPS payment region as the land.

So long as you are eligible for delinked payments, the value of your payments for 2024 to 2027 will not be affected if your farm size changes, or if you change what the land is used for, after BPS 2022 (the last year of the reference period).

You can receive delinked payments even if you choose to stop farming after the BPS 2023 application deadline (15 May 2023).

You will not be eligible for delinked payments if you have received a payment under the Lump Sum Exit Scheme.

Receiving delinked payments

You will not need to apply to receive delinked payments.

Your delinked payments information statement

In November, or December, 2023 we sent a statement for you to check, showing your reference amount based on the reference data we held for you at that time. We will use your reference amount when we calculate your delinked payments each year, if you are eligible.

If you claimed BPS in any of the scheme years 2020, 2021 or 2022, but did not receive an information statement, please contact us to request one. We will then check our records to confirm if you should have received a statement and let you know the outcome.

Decline payments

Contact RPA by email or post as soon as possible if you do not want to receive a delinked payment.

How reference amounts are calculated

Your delinked payments will be based on a ‘reference amount’. We use your BPS 2020, 2021 and 2022 payment information as the reference data to calculate your reference amount.

Your reference amount will be the average of the BPS payments made to your business for these scheme years, including any young farmer payment or greening payment.

Your reference amount will be adjusted if:

  • your BPS reference data is amended as a result of further RPA checks, such as following a BPS payment query or appeal you have submitted for any of the reference years, 2020, 2021 or 2022
  • BPS reference data has been transferred to or from your business.

We will add up your BPS payments for the 2020, 2021 and 2022 scheme years and divide by 3. We will divide by 3 even if no BPS payment was made to you in 1 or 2 of these 3 scheme years.

The reference data will take account of any reductions applied for over-claiming land.

The reference data will not take account of:

  • over-claim penalties (which can be applied to BPS payments on top of over-claim reductions)
  • reductions and penalties for not meeting the greening rules
  • late application penalties
  • penalties for not declaring all agricultural land parcels
  • cross compliance penalties
  • reductions to amounts above €150,000
  • progressive reductions for BPS 2021 and BPS 2022
  • amounts intercepted from your BPS 2020, 2021 or 2022 payments due to overpayments for other scheme years or other schemes

If you received a manual payment for BPS 2020, 2021 or 2022, this will be taken into account in your reference data.

If you also claimed BPS on entitlements in Scotland, Wales or Northern Ireland, your reference amount will be based only on the part of your payment which relates to your English entitlements. Payment schemes in Scotland, Wales or Northern Ireland will operate under the rules set by the relevant UK administration.

How delinked payments are calculated

We will apply progressive reductions when we calculate your delinked payments each year. This means the value of the delinked payments will become a smaller proportion of the reference amount each year.

Your delinked payment each year =

your reference amount - progressive reductions for that year

Use the progressive reductions calculator to see how progressive reductions may affect your payment for the 2024 scheme year. Different progressive reductions will be applied for years 2025 to 2027 as delinked payments are gradually phased out. These reductions have not been announced yet.

We plan to make your delinked payment in 2 instalments each year - an advance payment of around 50% from 1 August with the balance payment from 1 December.

If BPS reference data was used to calculate a payment under the Lump Sum Exit Scheme, it cannot also be used to calculate a delinked payment. We will contact farmers who are affected by this.

Transferring land after the reference period

Your reference amount will not be affected if you transfer out all or some of your land after 16 May 2022 (the BPS 2022 deadline). For example, where your tenancy comes to an end and the land goes back to the landlord. You will still need to have claimed, and been eligible for, BPS 2023 to receive delinked payments. To do this you will still have needed at least 5 hectares of eligible land and 5 BPS entitlements on 15 May 2023.

If you transfer in land after 16 May 2022, this will not increase your reference amount.

You can choose to transfer some or all of your reference amount to another business.

Business changes since BPS 2020

There may have been changes to the structure of your business since you were paid BPS 2020 (the first year of the reference period) which affect the delinked payments you could be eligible to receive. These changes could affect whether:

  • you meet the requirement to have claimed BPS in 2023
  • the BPS 2020 to 2022 payments of a previous business can be included in the calculation of your reference amount

This means you may want to ask us to transfer out some or all of your reference amount to a new business. To do this you will need to tell us how much BPS 2020 to 2022 reference data you want to transfer. The new business must have claimed, and been eligible for, BPS 2023 to receive delinked payments (except for some inherited land cases). For example, you may want to transfer some or all of your reference data if your business has:

  • a new Single Business Identifier (SBI)
  • been merged
  • been split

The business changes will affect which business receives a delinked payments information statement for which year(s). For example, if the business change meant you were given a new SBI just after BPS 2020, we would have sent one information statement covering BPS 2020 under one SBI and another statement covering BPS 2021 and 2022 under the new SBI. Or, in another example, we may have sent only one statement for a particular reference year or years (and SBI) to a business that was sold. You may want the reference data shown on the statement we sent to the original business to be transferred to one or more businesses that claimed BPS 2023.

New business

If your business has been given a new SBI, we will normally treat it as a new business which cannot benefit from the BPS claim history of a previous business. This means we will not consider the reference data of the previous business when calculating your reference amount. There are exceptions where reference data has been transferred to you.

Inherited land

If you inherit eligible land in England after 15 May 2020 from a farmer who has died and who claimed BPS in one of the years from 2020 to 2022, you can ask us to transfer all or part of their reference data to you. If a tenant has died and their beneficiary takes on their tenancy, we will treat this as an inheritance of eligible land. You will not be able to ask us to transfer any of the reference data until probate or letters of administration have been granted and the estate has been settled.

Eligible land means the same as for BPS.

For inherited land cases, you will need to make your transfer request using the Delinked Payments Transfer Request form. You can make a transfer request, in cases of inheritance only, until 31 December 2027.

If you are the sole inheritor of the land, you can ask us to transfer all the reference data from the farmer who has died. If land has been inherited by more than one person, each person can ask us to transfer some of the deceased person’s reference data. A separate Delinked Payments Transfer Request form will need to be submitted for each business. Where possible, you should all agree how you want the reference data to be split between you, before you make your transfer requests. The total sum of the reference data on the transfer requests cannot be more than the total reference data of the farmer who has died.

If you make a transfer request after we have made a delinked payment to the original business, we will take the request into account for any future delinked payments which are due.

If you inherit the land after 15 May 2023 (the BPS 2023 application deadline), you do not need to have claimed BPS in 2023. If you inherit land with a sitting tenant before 15 May 2023 and the land was still let to the tenant on 15 May 2023, you do not need to have claimed BPS in 2023.

If, before delinked payments end, a sole trader dies and an executor or administrator is appointed, this will be treated as the same business. RPA will need to be sent a grant of probate or letters of administration to be able to pay any delinked payments due.

We will then continue to pay the deceased person’s business until the estate is settled. Once the estate is settled, the inheritors of the land can ask RPA to transfer reference data to their business. They will need to make this transfer request before 31 December 2027.

Read information about what to do if a customer registered with the Rural Payments service dies.

Becoming a partnership

If the business status of a sole trader has changed to a partnership since BPS 2020, we treat this as the same business and the SBI should be the same. This means the partnership can use the BPS claim history of the sole trader for delinked payments.

If 2 or more businesses merged to form a partnership, reference data can be transferred from the previous businesses to the new partnership’s SBI.

If there has been a change to the legal status or ownership of your business, you may have been given a new SBI. For example, this may be the case if a partnership has become a limited company. If you have been given a new SBI, we will normally treat it as a new business which cannot benefit from the BPS claim history of a previous business. This means we will not consider the reference data of the previous business when calculating your reference amount. There are exceptions where some or all of the reference data is transferred to you.

Business structure changes after 15 May 2023

If your business structure changes after 15 May 2023 (the BPS 2023 application deadline), we will still make the delinked payments to the SBI which claimed BPS 2023 (except for some inherited land cases).

You should complete an IACS 26 or IACS 27 form if you are claiming, or planning to claim, under our other schemes.

You can change the bank account we use to pay you at any time. For example, if a partnership ends or a limited company is wound up after it claimed BPS 2023, you can change the bank account that is linked to that SBI. We will then pay any delinked payments to that bank account. The bank account does not need to match the original trading name of the business.

To change your bank account, call 03000 200 301, Monday to Friday, 8:30am to 5pm, except bank holidays.

Locked (or ‘closed’) businesses

If you have stopped farming and your farming business has ended, RPA will usually ‘close’ the business on our records. As a closed business, you will not be able to use the Rural Payments service to ask us to transfer reference data. (The closed business will show as ‘locked’ in Rural Payments.) Instead, the business(es) that has taken on land from you can request that some or all of your reference data is transferred to them.

When and how you can transfer a reference amount to another business

If you request the transfer of all or part of a reference amount, we will process this by transferring reference data. This means you will need to tell us how much reference data you want to transfer.

The ‘reference data’ is the BPS 2020 to 2022 payments (before some reductions and penalties, as listed above). The ‘reference amount’ is the sum of the reference data divided by 3.

You can transfer all or part of your reference data, used to calculate your reference amount, to another business or businesses. For example, you might want to do this if, since BPS 2020, your business has merged or split, your SBI has changed or you have transferred (such as by sale or gift) some or all of your farm to someone else. There are special rules for inherited land.

You will be able to ask us to transfer some or all of your reference data during a transfer period, from 15 February to 10 May 2024. This transfer period will be the only opportunity to ask us to transfer reference data, other than in circumstances of inherited land.

How to make your transfer request

You will usually be able to make your transfer request using the Rural Payments service. Read more about how to do this in the How to make a delinked payments reference data transfer request guidance.

We’ll need to know details of the business which currently holds the reference data (transferor), the receiving business (transferee) and the amount of reference data you want to be transferred.

The online option to request a transfer of reference data will not be available to you if you are:

  • a business wishing to request a transfer of reference data from a closed (locked) business
  • requesting to transfer reference data as you have inherited land

In these circumstances you will need to complete a Delinked Payments Transfer Request form and return it to RPA by the deadline. To request a transfer of reference data from a closed (locked) business the deadline is the end of the transfer period on 10 May 2024. In cases of inherited land we will accept the request until 31 December 2027.

Customers without online access can contact us and we will assist them to complete a transfer of reference data. They must contact us by the end of the transfer period on 10 May 2024.

Below is an example of how a transfer of reference data will change the reference amounts for two businesses.

Example

Farmer A transfers some of their reference data to Farmer B

Farmer A

BPS payments (before some reductions and penalties):

2020 £20,000

2021 £25,000

2022 £15,000

Reference data £60,000 (total payment for 2020, 2021 and 2022 scheme years)

Reference amount £20,000 (reference data / 3)

Farmer A can choose how much of their £60,000 reference data they ask us to transfer. If the transfer meets our rules, we would then recalculate Farmer A’s reference amount by dividing their remaining reference data by 3.

Farmer A transfers £45,000 of their reference data to Farmer B

Farmer A’s new reference data is £15,000 (£60,000 - £45, 000 = £15,000)

Farmer A’s new reference amount is £15,000 / 3 = £5,000

We would also recalculate the reference amount of the person they transferred their reference data to (Farmer B).

Farmer B starts with £30,000 reference data

Farmer B’s starting reference amount is £30,000 / 3 = £10,000

Farmer A transfers £45,000 of reference data to Farmer B

Farmer B’s new reference data is £75,000 (£30,000 + £45,000 = £75,000)

Farmer B’s new reference amount is £75,000 / 3 = £25,000

It is up to you if you want to transfer any of your reference data. We will not get involved in disputes between you and another business. You may want to seek professional advice before transferring any of your reference data.

You can choose how much of your reference data to transfer. You cannot transfer more than the total value of your reference data. You do not need to have claimed BPS 2023 to be able to transfer your reference data. To receive delinked payments, the business receiving the transferred reference data must have claimed, and been eligible for, BPS 2023 (except for some inherited land cases).

You cannot transfer your reference data if you have applied under the Lump Sum Exit Scheme (unless you have withdrawn your application).

Transfer of reference data needing a supporting land transfer

In some cases, you can only transfer your reference data if eligible land in England was transferred from the business transferring out the reference data to the business receiving the reference data. The transfer of land must have happened after 15 May 2020 and before 16 May 2023. A transfer of land is needed where you:

  • have a reference amount of more than £30,000 and the transfer is for only part of your reference data or is to more than one business - this rule is to stop reference data being artificially split between businesses to reduce the progressive reductions that apply
  • want to transfer out reference data that has been transferred to you from another business - farmer A to farmer B and then onto farmer C
  • want to transfer reference data from a business where the SBI has been closed - the SBI will be shown as ‘locked’ on the Rural Payments service and we will have written to the business to tell them we have closed the SBI

In most cases we should already have evidence showing the land transfer. We will ask you for other evidence of the land transfer if we need it.

Eligible land means the same as for BPS.

Types of land transfer

If you were the owner-occupier of the land, the transfer can be by sale, gift or renting it out under a Farm Business Tenancy or Agricultural Holdings Act 1986 tenancy (or equivalent). This includes where you restructured your business and by 15 May 2023 the land was at the disposal of the new business for claiming BPS.

If you were the tenant, the transfer can be by:

  • surrendering the tenancy to your landlord or you (or your landlord) ending the tenancy having served a Notice to Quit
  • the tenancy expiring
  • assigning the tenancy (transferring it to someone else)
  • succession - if you had an Agricultural Holdings Act 1986 tenancy with succession rights

Examples of transferring reference data

Retiring farmer

A farmer (Business A) claimed BPS in 2020 and 2021 and then left farming. Business A did not apply under the Lump Sum Exit Scheme. Business A transfers their farm to Business B who then claims BPS in 2022 and 2023. This means:

  • Business A will not be eligible for delinked payments
  • if we have not closed the SBI for Business A, Business A can ask us to transfer their BPS 2020 and 2021 reference data to Business B (or another business). If we have closed the SBI for Business A, Business B can ask us to transfer the reference data from Business A because the land transfer rules have been met

New farmer

Business A transferred in some land from Business B at the end of 2022 and then claimed BPS for the first time in 2023. Business B had claimed BPS in 2020, 2021 and 2022. This means Business A will not receive any delinked payments unless Business B or another business asks us to transfer reference data to Business A.

Split business

Business A claimed BPS in 2020 and then split into 2 businesses, each with a new SBI (B and C). We closed the SBI for Business A. Business B and C each claimed BPS in 2021, 2022 and 2023. This means:

  • when calculating the reference amount for Business B we will take account of the BPS 2021 and BPS 2022 payments made to that business. The equivalent applies for Business C
  • Business B and Business C can each ask us to transfer some of the BPS 2020 reference data from Business A if the land transfer rules have been met. The total reference data transferred must not be more than the BPS 2020 reference data for Business A

Merged business

Business A and Business B each claimed BPS in 2020 and merged to form one business. The merged business claimed BPS in 2021, 2022 and 2023 using the SBI for Business A. We closed the SBI for Business B. This means:

  • when calculating the reference amount for Business A, we will take account of the BPS 2020, 2021 and 2022 payments made to that SBI
  • Business A can ask us to transfer the BPS 2020 reference data from Business B because the land transfer rules have been met

Invalid transfers

If reference data is transferred to you that should not have been, you will lose that reference data. For example, this could be the case if we find an error with the BPS 2020, 2021 or 2022 reference data after the transfer has been made.

Overpayments

If we need to recover overpayments from you, we may add interest to the amount recovered. This will be the Bank of England base rate plus 1%.

Tax treatment for delinked payments

Where a business receives delinked payments, these will be taxed as ‘income’.

Applying for other schemes

You can also apply for any other scheme you are eligible for. If you’re a farmer, land manager or forester, read Funding for farmers, growers and land managers for information about opportunities to apply for money to improve the environment and your farm’s productivity. You can keep up to date with scheme news by reading the Rural Payments Agency website and the Defra Farming blog.

If you claim under our other land-based schemes, you should keep your land information up to date by checking your digital maps in the Rural Payments service. Not doing so could affect your payments under any existing schemes you are part of and future schemes you enter into.

Timetable

2023

  • You must have claimed, and been eligible for, BPS 2023 (except for some inherited land cases)
  • We issued an information statement, showing your reference amount based on the reference data we held at the time

2024

  • If you disagreed with the BPS 2020 to 2022 reference data shown on your delinked payments information statement, you must have filled in and returned a Basic Payment Scheme: payment query form by 29 February 2024. A later deadline applies if you want to query or appeal a new BPS decision that we notified you about after 1 January 2024. Read our Complaints procedure.
  • You can request to transfer some or all of your reference data (used to calculate your reference amount) to another business during a transfer period. The transfer period opens on 15 February and closes at 11:59pm on 10 May 2024
  • Delinked payments will be made in 2 instalments each year

We plan to make advance payments of around 50% from 1 August with the balance payments from 1 December. The balance payments will usually be made by the end of the following January. The payments will be paid each year from 2024 to 2027.

Appeals

For information about how to appeal against a decision we make about your delinked payments, and the deadlines that apply, read our Complaints procedure.

Contact RPA

Rural Payments Agency (RPA)
PO Box 352
Worksop
S80 9FG

Email: ruralpayments@defra.gov.uk and put ‘Delinked payments’ in the Subject heading.

Telephone: 03000 200 301

Published 8 February 2022
Last updated 1 March 2024 + show all updates
  1. Text updated to show that the 29 February 2024 deadline has passed.

  2. To coincide with the delinked payments transfer window opening, we’ve updated the guidance with more information about transferring reference data.

  3. The guidance has been updated to reflect that regulations have now been approved by Parliament, and that Delinked Payments Information Statements have now been sent. We will update this guidance again in early 2024 to include more information about transferring reference data.

  4. 'Delinked payments: replacing the Basic Payment Scheme guidance' updated.

  5. First published.