Farmers in Northern Ireland face the break up of small farms and land values driven down. NI finance minister Sammy Wilson warns that a controversial House of Lords tax ruling could leave thousands of acres of farmland liable to massive unforeseen taxes.

The ruling affects land let under the Irish system of ‘conacre’, an informal system of letting land which is unique to Ireland. A third of farms in Northern Ireland use it.

The plot of land that was the subject of an appeal in the House of Lords was being farmed under a conacre agreement and was reclassified from ‘business activity’ to ‘investment activity’ on the death of the owner. The Court of Appeal supported a claim by HM Revenue & Customs that some land let in conacre should be subject to inheritance tax. The House of Lords has now refused to hear a further appeal. Speaking to the Belfast Telegraph, Wilson said: “I am very concerned over the potential impact this court ruling may have on our local farming community — where one third of its land is let out as conacre. 

“This decision could result in thousands of acres of farmland now being liable to 40% inheritance tax. This could lead to the break-up of small farms and drive down agricultural land values. 

“I intend to continue to press the Treasury for recognition of the uniqueness of this issue for Northern Ireland and the implications for our local agriculture industry. I will work with the Ulster Farmers’ Union, and other interested groups, in seeking ways to alleviate the adverse impact of this ruling.”