Farming in tax law: occupation of land
S996(1) Income Tax Act 2007, S1125 Corporation Tax Act 2010
There is no statutory definition of occupation of land. The meaning of such occupation has been considered in other legal contexts and, in particular, in rating law.
From this, occupation should not be considered as synonymous with ownership or legal possession but is a question of fact in each case. Occupation involves one or other of the following:
- Activity on the land with acts by the occupier as user of the property
A physical possession and presence
- A degree of permanence
- The conveying of a benefit to the possessor
Usually there is no difficulty about occupation of land. Most farmers are clearly the sole occupiers of the land they farm, whether as owner-occupiers or tenants. But some situations are less clear-cut and guidance on these is provided as follows:
- Farm land let for a period of 365 days or more - BIM55060
- Short-term grazing lets - BIM55065
- Share farming - BIM55070 - BIM55085
- Contract farming - BIM55090
In the past the view was that occupation by a person must be to the exclusion of all others. Whilst this is still a persuasive factor in demonstrating occupation, it is not essential. Share farming is illustrative of this, see BIM55070.