buying entitlements for naked land

red bull

A friend of mine bought a few hectares with no entitlements and he wonders should he buy some, Not sure how to answer him, what do ye think ?

grace2312

red bull wrote: »

A friend of mine bought a few hectares with no entitlements and he wonders should he buy some, Not sure how to answer him, what do ye think ?

Is he an active farmer?! Was he farming in 2013?

Is he a young trained farmer with herd number?

red bull

He is actively farming and was in2013, he has a herd number. Alas not young. He has being farming bits of rented land for years

micraX

Well if he bought the land and is farming it in his own right surely he is more entitled to the entitlements than anyone.

red bull

Any advice on what he should do would be very welcome.

Sami23

red bull wrote: »

Any advice on what he should do would be very welcome.

He should buy as high a value entitlements as he can afford this year as this will guarantee him an income until 2019

adne

Sami23 wrote: »

He should buy as high a value entitlements as he can afford this year as this will guarantee him an income until 2019

But the high values entitlements will drop in value in increments until 2019, wasn't he better to buy as low of value entitlements (less than 150) as he can and they will increment in value each year until 2019

donegal11

adne wrote: »

But the high values entitlements will drop in value in increments until 2019, wasn't he better to buy as low of value entitlements (less than 150) as he can and they will increment in value each year until 2019

I thought it's pointless buying low value entitlements as they'll be added to your existing entitlements value in 2014 and stacked on the area farmed in 2013 or 2015 if less. You'll have to wait post 2015(if allowed) to buy entitlement to a specific piece of land if you didn't farm it in 2013 or if you did and declared it in 2015 you'll receive entitlements for it next year and if low valued then averaged to 160 anyway. I could be wrong.

Farmer Pudsey

If no entitlements and in 2013 he filled in an SFP form(for Da etc) into 2015 he will begin to get a payment. If he buys entitlements this year they will disqualify him from this but more importantly the one he buys will cease to exist he has to wait until post 2015 if he wishes to buy entitlements.

the department has published a booklet it was in the week before last FJ but may be available in Teagasc office or department offices get one. The other advice is go into the Dept and get an official explaination

Charliebull

My understanding is your land area will be divided by your current number of entitlements to give your new average going forward from 2015, the land area to be used is the lesser of the two of in 2013 or 2015, your average will not be allowed to exceed the new national average which is as if yet unknown,

So each case is different and needs to be worked out on an individual basis

donegal11

Charliebull wrote: »

My understanding is your land area will be divided by your current number of entitlements to give your new average going forward from 2015, the land area to be used is the lesser of the two of in 2013 or 2015, your average will not be allowed to exceed the new national average which is as if yet unknown,

So each case is different and needs to be worked out on an individual basis

to me that bit in bold makes no sense. I'd guess your wrong.

Charliebull

donegal11 wrote: »

to me that bit in bold makes no sense. I'd guess your wrong.

Wouldn't be the first time

august12

Hi, in a similar position to original question here, actively farming in 2013 with entitlements, purchased additional land in late 2013 (this land not submitted on 2013 SFP application as not in ownership of it at that stage). The value of my entitlements will be based on 2014 SFP value divided by the land submitted in 2013 as it will be lower than land submitted in 2015. Is there any point in buying additional entitlements for the naked land and how is the calculation done i.e. Total value of SFP submitted in 2014 (assuming I purchase additional entitlements) divided by land submitted in 2013 (each entitlement value will increase from 2013 value if I opt to purchase additional entitlements). Am I correct in stating I don't have to sell my entitlements to buy higher value ones as I will have this additional land to submit this year with no entitlements attached. Also, would it be better to buy higher value as opposed to low value? P.s I would not come under 'Young Farmer' category. Would appreciate any info on this before submitting this years application.

Sami23

august12 wrote: »

Hi, in a similar position to original question here, actively farming in 2013 with entitlements, purchased additional land in late 2013 (this land not submitted on 2013 SFP application as not in ownership of it at that stage). The value of my entitlements will be based on 2014 SFP value divided by the land submitted in 2013 as it will be lower than land submitted in 2015. Is there any point in buying additional entitlements for the naked land and how is the calculation done i.e. Total value of SFP submitted in 2014 (assuming I purchase additional entitlements) divided by land submitted in 2013 (each entitlement value will increase from 2013 value if I opt to purchase additional entitlements). Am I correct in stating I don't have to sell my entitlements to buy higher value ones as I will have this additional land to submit this year with no entitlements attached. Also, would it be better to buy higher value as opposed to low value? P.s I would not come under 'Young Farmer' category. Would appreciate any info on this before submitting this years application.

Yes advice would be to buy entitlements now for the new land and this will bring up your overall average payment per Ha until 2020

benjydagg

Charliebull wrote: »

My understanding is your land area will be divided by your current number of entitlements to give your new average going forward from 2015, the land area to be used is the lesser of the two of in 2013 or 2015, your average will not be allowed to exceed the new national average which is as if yet unknown,

So each case is different and needs to be worked out on an individual basis

COMPLETELY INCORRECT

benjydagg

august12 wrote: »

Hi, in a similar position to original question here, actively farming in 2013 with entitlements, purchased additional land in late 2013 (this land not submitted on 2013 SFP application as not in ownership of it at that stage). The value of my entitlements will be based on 2014 SFP value divided by the land submitted in 2013 as it will be lower than land submitted in 2015. Is there any point in buying additional entitlements for the naked land and how is the calculation done i.e. Total value of SFP submitted in 2014 (assuming I purchase additional entitlements) divided by land submitted in 2013 (each entitlement value will increase from 2013 value if I opt to purchase additional entitlements). Am I correct in stating I don't have to sell my entitlements to buy higher value ones as I will have this additional land to submit this year with no entitlements attached. Also, would it be better to buy higher value as opposed to low value? P.s I would not come under 'Young Farmer' category. Would appreciate any info on this before submitting this years application.

Buy high....

red bull

Farmer Pudsey wrote: »

If no entitlements and in 2013 he filled in an SFP form(for Da etc) into 2015 he will begin to get a payment. If he buys entitlements this year they will disqualify him from this but more importantly the one he buys will cease to exist he has to wait until post 2015 if he wishes to buy entitlements.

the department has published a booklet it was in the week before last FJ but may be available in Teagasc office or department offices get one. The other advice is go into the Dept and get an official explaination[/QUO


CORRECT ANSWER

benjydagg

Farmer Pudsey wrote: »

If no entitlements and in 2013 he filled in an SFP form(for Da etc) into 2015 he will begin to get a payment. If he buys entitlements this year they will disqualify him from this but more importantly the one he buys will cease to exist he has to wait until post 2015 if he wishes to buy entitlements.

the department has published a booklet it was in the week before last FJ but may be available in Teagasc office or department offices get one. The other advice is go into the Dept and get an official explaination

"The one he buys will cease to exist"?????? What fiction are ye reading? Any farmer who put in a valid SFP application in 2013 is "active". Any active farmer can buy entitlements. The lessor amount of land claimed in 2013 or 2015 will be divided into the amount of entitlements held in 2014 (not necessary to active all of them).

red bull

benjydagg wrote: »

"The one he buys will cease to exist"?????? What fiction are ye reading? Any farmer who put in a valid SFP application in 2013 is "active". Any active farmer can buy entitlements. The lessor amount of land claimed in 2013 or 2015 will be divided into the amount of entitlements held in 2014 (not necessary to active all of them).

Only if he had entitlements in 2013. An SVP application in 2013 only got DAs where you had no entitlements

benjydagg

red bull wrote: »

Only if he had entitlements in 2013. An SVP application in 2013 only got DAs where you had no entitlements

REDBULL & FARMERPUDSEY An active farmer did not need to own entitlements in 2013, just to have submitted an SFP form. He is perfectly entitled to purchase them this year, as we all are. Surplus entitlements can be bought this year, and not used in 2014, but they will be added to his pot of money going forward to 2019. Entitlements bought this year do not vanish for anyone. Be very careful in your interpretation of the rules. I deal with SFP 5 days a week in my work.

benjydagg

donegal11 wrote: »

I thought it's pointless buying low value entitlements as they'll be added to your existing entitlements value in 2014 and stacked on the area farmed in 2013 or 2015 if less. You'll have to wait post 2015(if allowed) to buy entitlement to a specific piece of land if you didn't farm it in 2013 or if you did and declared it in 2015 you'll receive entitlements for it next year and if low valued then averaged to 160 anyway. I could be wrong.

The averaging of low value entitlements to €160 in 2019 is a rumour that needs to be put to bed. Nowhere are low value entitlements guaranteed to hit €160. It will be closer to €120, as it is a percentage of the average.

Farmer Pudsey

benjydagg wrote: »

REDBULL & FARMERPUDSEY An active farmer did not need to own entitlements in 2013, just to have submitted an SFP form. He is perfectly entitled to purchase them this year, as we all are. Surplus entitlements can be bought this year, and not used in 2014, but they will be added to his pot of money going forward to 2019. Entitlements bought this year do not vanish for anyone. Be very careful in your interpretation of the rules. I deal with SFP 5 days a week in my work.

Benjy I am only reading from the Department suplement from the FJ that was my interpetation I may have read it wrong. I will check it again this evening

Farmer Pudsey

I finally got around to reading this part of the hand out again it is page11 condition 2 it is as below

Farmers who never held entitlements but who actively farmed in 2013 (Scottish Derogation SD)

it summerise as follows farmers who never held entitlements either owned or leased but who were actively farming in 2013 such farmer must provide verifiable evidence of production for that year

Farmers who fulfil this condition are advised not to purchase entitlement under the 2014 scheme year. Such entitlements will not carry forward in the new scheme in 2015 and would have the effect of disqualifying farmers from receiving an allocation of entitlements under the SD.

Now that is according to the Dept booklet.

Maybe it refers only to farmers that did not submit an SFP in 2013 but were farming. However it is fairly clear.

I would advise any farmers in such a position to go into the department and get someone who know the rules to advise them. Then get them to put the advise on Dept paper and put a copy in there file and give them a copy. Put it in a safe place

benjydagg

Farmer Pudsey wrote: »

I finally got around to reading this part of the hand out again it is page11 condition 2 it is as below

Farmers who never held entitlements but who actively farmed in 2013 (Scottish Derogation SD)

it summerise as follows farmers who never held entitlements either owned or leased but who were actively farming in 2013 such farmer must provide verifiable evidence of production for that year

Farmers who fulfil this condition are advised not to purchase entitlement under the 2014 scheme year. Such entitlements will not carry forward in the new scheme in 2015 and would have the effect of disqualifying farmers from receiving an allocation of entitlements under the SD.

Now that is according to the Dept booklet.

Maybe it refers only to farmers that did not submit an SFP in 2013 but were farming. However it is fairly clear.

I would advise any farmers in such a position to go into the department and get someone who know the rules to advise them. Then get them to put the advise on Dept paper and put a copy in there file and give them a copy. Put it in a safe place

I think you are taking that paragraph out of context farmerpudsey, I may be wrong.
ELIGIBILITY CONDITIONS "a farmer must fulfil at least one of the following........... CONDITION ONE;
a farmer who was eligible to receive a direct payment in 2013 is automatically entitled to receive an allocation of entitlements under the BPS 2015..... "
(so by having an application lodged in 2013, regardless of owning entitlements he is eligible)

Condition two doesn't come into play.

So in my opinion he should buy. Buy HIGH and BUY SOON. This is my personal opinion only, I am not qualified to advise.

To get clarification on the above or any entitlement queries contact CAPdirectpayments@agriculture.gov.ie

Farmer Pudsey

benjydagg wrote: »

I think you are taking that paragraph out of context farmerpudsey, I may be wrong.
ELIGIBILITY CONDITIONS "a farmer must fulfil at least one of the following........... CONDITION ONE;
a farmer who was eligible to receive a direct payment in 2013 is automatically entitled to receive an allocation of entitlements under the BPS 2015..... "
(so by having an application lodged in 2013, regardless of owning entitlements he is eligible)

Condition two doesn't come into play.

So in my opinion he should buy. Buy HIGH and BUY SOON. This is my personal opinion only, I am not qualified to advise.

To get clarification on the above or any entitlement queries contact CAPdirectpayments@agriculture.gov.ie

This is why I said to clarify with dept I am not sure if i am out of context. also you have to remember that under condition 1 an farmers with a payment less than 100 euro in total is not considered eligible. In the Booklet common questions No3 and 5 page 33 and 34 covers this

Question No5 relates to some one with no entitlements that but received a DAS payment in 2013 and the answer is that this will not entitle them to an allocation of rights.

Anyone in these positions should read the booklet and go into the department and clarify and get a written opinion from the department official.

Also I would not advise people to buy rights that will average over 400/HA as after reduction's before 2019 the cost may be 3-4 time entitlement.

Remember clarify your situtation, payments of 300/HA on 20HA a payment of 6K/year will cost about 14.5K after auctioneers fees. At 400/HA it will cost about 20K and I think you will suffer a 10% reduction so receive about 7.2K/year.

Clarify, Clarify, Clarify do not take my word/opinion or Benjy word/opinion.