Image for article: Basic Payment Scheme - Payment reductions confirmed for 2021 to 2027

Basic Payment Scheme - Payment reductions confirmed for 2021 to 2027

10 December 2020
Butler Sherborn logomark

Keep up to date with the latest properties, rural business insights, market commentary and events:

Join mailing list

 

Basic Payment Scheme - Payment reductions confirmed for 2021 to 2027

It has now been confirmed how Direct Payments are to be phased out in England from 2021 to 2027. Reductions to BPS payments will start from 2021 and are to be reduced progressively until 2027. The reductions are to apply to the total payment the farmer would have received each year and are to work in a similar way to income tax bands, with bigger reductions for the higher payment bands.

The reduction in payment will also to apply to delinked payments when these replace BPS.

Payments will be reduced by the following percentages in 2021-2024:

Payment Band

Scheme Year

2021

2022

2023

2024

Up to £30,000

5%

20%

35%

50%

£30,000 to £50,000

10%

25%

40%

55%

£50,000 to £150,000

20%

35%

50%

65%

£150,000 <

25%

40%

55%

70%

 

To further explain this, the following table shows how payments will be reduced from 2021 to 2024 based on the payment value before the reductions.

Payment value before progressive reductions

2021 payment

2022 payment

2023 payment

2024 payment

£5,000

£4,750

£4,000

£3,250

£2,500

£10,000

£9,500

£8,000

£6,500

£5,000

£20,000

£19,000

£16,000

£13,000

£10,000

£40,000

£37,500

£31,500

£25,500

£19,500

£80,000

£70,500

£58,500

£46,500

£34,500

£160,000

£134,000

£110,000

£86,000

£62,000

 

As an example, in 2021 for an income of £80,000 before reductions, the calculations are as follows:

Band 0 - £30,000:                           £30,000 at 5% = £1,500 reduction

Band £30,000 - £50,000:                £20,000 at 10% = £2,000 reduction

Band £50,000 - £80,000:               £30,000 at 20% = £6,000 reduction

Total reduction £9,500

£80,000 minus £9,500 = £70,500

We will keep you updated but if you do have any queries, please call Hennie Carter or Georgina Bush on 01285 883740.

 

News & Comment
Read Article
Huxmor Mortgages

Mortgage Rates - Recent Update

Charlie Huxley, the founder of Huxmor Limited, discusses the recent developments in mortgage rates. While the changes may not be dramatic, they create a vital opportunity for homebuyers and landlords to take decisive action and leverage on strategic advantages.

Market Update
Read Article
The Woolpack Pub

Pub Of The Month - The Woolpack, Slad

Nestled in the Slad Valley, The Woolpack has been celebrated for its unique charm for more than 300 years.

Pub Of The Month
Read Article
Cotswold Country Homes

Five Of Our Finest Country Home's

Exploring Timeless Elegance and Rural Charm in the Heart of the Cotswold Countryside.

Five Of Our Finest Country Home's
Read Article
Renters Reform Q&A

Crucial Insights On The Renters Reform Bill

Gain a comprehensive understanding of the latest Renters' Reform Bill. Vanessa Carter, the Head of Lettings at Butler Sherborn, shares valuable insights from the agency’s perspective, while Bethen Abraham, a legal expert from Willans LLP Solicitors, delivers an informed legal stance on this significant legislation.

Renters Reform Bill - Q&A
A laptop on a desk with houseplants an coffee
Instant Digital Valuation

Wondering what your property is worth?

Get an estimated valuation for you property using our free digital valuation tool.

CAAV logo
The London Office logo
The Property Ombudsmen logo
Rics logo
Team Way Eventing logo
Rightmove logo