Written Answers. - Farmers' Tax Liability.
Pat Cox
Question:
108
Mr. Cox
asked the
Minister for Finance
the number of farmers liable for income tax in 1994 and for each of the past four years; the expected income tax yield from farmers in 1994 and the actual yield for the past four years; and the income base on which farmers' tax liability is reckoned.
Following is the information requested.
The amounts of income tax paid on farming profits and the numbers actually liable to tax from 1990 to 1994 are estimated as follows:
|
Year
|
Income Tax Payments(¹)
|
Numbers actually liable to tax
|
|
£m
|
|
|
1990
|
45
|
28,000
|
|
1991(²)
|
36
|
26,000 (P)
|
|
1992
|
48
|
27,000 (P)
|
|
1993
|
52
|
28,000 (P)
|
|
1994(³)
|
56
|
28,000 (P)
|
Notes on table
(P) Provisional and likely to be revised.
(¹) Income tax on farming profits is collected with Schedule D tax generally and the figures shown are to some extent estimated. The figures shown in the table are the tax paid by full-time farmers together with estimated tax paid by trader-farmers on their farming profits.
(²) The yield in 1991 from farmers was reduced by the once-off effect of deferring payment of the balances of 1990-91 tax from 1991 to 1992. Ordinarily these balances would have been paid in 1991 but were deferred to 1992 as a transitional effect of introducing the current year basis of assessment for self-employed persons in 1990. The yield from farmers in 1991 was further reduced because of a decrease in farming profits.
(³) Budget estimate.
The figures given in the table do not include the PAYE tax paid on employment income earned by farmers or their spouses. Such tax is included in the overall collection of PAYE and is not distinguishable until after the income tax returns submitted by farmers have been analysed. An analysis of the returns for the income tax year 1990-91, the latest available, indicates that some £33 million in tax was paid by farmers, including trader-farmers, or their spouses, under the PAYE system for that year.
In common with all self-employed taxpayers, the income base on which farmers' income tax liability is reckoned is the gross income from all sources before adjustments are made in respect of capital allowances, qualifying deductible expenditure and personal allowances and reliefs.
The latest year for which income distribution information on farmers is available is the income tax year 1990-91. The gross income of full-time farmers who were assessed to tax for 1990-91 was £564 million.
The corresponding income of trader-farmers who were assessed to tax for the same year was £219 million. This amount includes income from trades and professions other than farming and is not distinguished in the total.
