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Basic Payment Scheme Entitlements Bernie Brennan.

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Presentation on theme: "Basic Payment Scheme Entitlements Bernie Brennan."— Presentation transcript:

1 Basic Payment Scheme Entitlements Bernie Brennan

2 Entitlement Reference Points Eligible to receive a direct payment of €100 or more in 2013 (single payment scheme, grassland sheep scheme, Burren Life, or Beef Data Programme) Eligible land declared in 2013 Value of Entitlements owned in 2014 (including entitlements leased out) plus value of 2014 Grassland Sheep Scheme Eligible land declared in 2015 *The number of entitlements is established by using the lesser of the eligible hectares declared in 2013 or Allocation Right *2013 Land Reference 2014 Value Reference (a fixed % of this value will be carried forward) 2014 Value Reference (a fixed % of this value will be carried forward) *2015 Land Reference

3 Convergence of Entitlements National Average 90% National Average Minimum Value of 60% – (by 2019) (Transfer of €115m) High Initial Unit Value Low Initial Unit Value *€ *€ *€ *estimated values based on 2013 data

4 Provisional Statement 120,000 statements have issued Based on 2013 land and 2014 value Values are estimated (national average) Leased land included; but not leased in value of entitlements. PCC to continue lease of entitlements with land. Gift/Inheritance in 2014: (5,000 letters issued) Provisional Statement will issue shortly for these cases. Final Statement will issue in March 2016

5 Review of Allocation Process 2013 land 2014 value Partnerships in 2013 review required to identify land and value for each partner (Provisional Statement and letter will issue shortly) Restricted to those who believe 2013/2014 data inaccurate Online or Paper form

6 National Reserve & Young Farmers Scheme

7 Young Farmers Defining ‘Young Farmer’ 40 or less in year of application Established within five years FETAC level 6 Defining ‘Young Farmer’ 40 or less in year of application Established within five years FETAC level 6

8 Young Farmers Defining ‘Young Farmer’ 40 or less in year of application Established within five years FETAC level 6 National Reserve Allocate on naked land Increase value maximum of 90 Off-farm income: €40,000 National Reserve Allocate on naked land Increase value of entitlements maximum of 90 Off-farm income: €40,000

9 Young Farmers Defining ‘Young Farmer’ 40 or less in 2015 Established within five years FETAC level 6 Young Farmer’s Scheme Additional payment Maximum of five years Flat rate payment Paid on entitlements activated; Maximum of 50 National Reserve Allocate on naked land Increase value of entitlements maximum of 90 Off-farm income: €40,000 Defining ‘Young Farmer’ 40 or less in year of application Established within five years FETAC level 6

10 Young Farmers Defining ‘Young Farmer’ 40 or less in 2015 Established within five years FETAC level 6 Defining ‘New Entrant’ Establish in 2013 or later FETAC Level 6 Young Farmer’s Scheme Additional payment Maximum of five years maximum of 50 National Reserve Allocate on naked land Increase value maximum of 90 Off-farm income: €40,000 National Reserve Allocate on naked land Increase value of entitlements maximum of 90 Off-farm income: €40,000 Young Farmer’s Scheme Additional payment Maximum of five years Flat rate payment Paid on entitlements activated; Maximum of 50 Defining ‘Young Farmer’ 40 or less in year of application Established within five years FETAC level 6

11 Defining ‘Young farmer’ ‘ New Entrant’ in Groups Joint herdnumber Partnership Company At least one person must meet definition of ‘young farmer’ Must declare that effective control of decision making power lies solely or jointly with young farmer – and provide supporting evidence – Name on herdnumber – Name on Entitlements – Name on bank account – Legal declaration signed by all parties – New Entrant in group- All members of group/ partnership/ company must be new entrants

12 National Reserve - Categories Young FarmersNew Entrant  Aged 40 or less in first year of BPS application  Established the holding during the 5 years preceding the first submission of a BPS application  Agricultural Qualification (FETAC Level 6).  Has off farm income no greater than €40,000  Maximum allocation 90 hectares  No age restriction on applicants  Commencing in 2013 or later and must apply to BPS within two years of commencing  Agricultural qualification at FETAC level 6.  Has off farm income no greater than €40,000  Maximum allocation 90 hectares

13 National Reserve – Optional Categories Old Young Farmer  Aged 40 or less in first year of BPS application  Established the holding during 2008/2009  Agricultural Qualification (FETAC Level 6).  Has off farm income no greater than €40,000  Maximum allocation 90 hectares  Others options under consideration Including Force Majeure (clarification awaited from Commission)  Application form available in April  Closing date of 15 May If National Reserve over subscribed, reduction coefficients may be applied

14 ThresholdJoint VentureCompanyRegistered Partnership Young Farmers Scheme Based on Entitlements activated by joint venture; maximum of 50 Based on entitlements activated by company; maximum of 50 Entitlements activated by young farmer; maximum of 50 Balance may be redistributed to other partners National Reserve Allocation Maximum of 90 for the joint venture. All entitlements below national average eligible for top up. Maximum of 90 for the company Maximum of 90 for the Partnership. Allocation to young farmer (s) only based on land declared by young farmer(s). Does not extend to other land. NR Income Limit (€40,000) Combined income of individuals Off-farm income of Company and directors Off-farm income of young farmer only *Partnership using one herdnumber treated in same way as Joint Venture

15 Partnerships  Each partner brings own reference points  Separate set of entitlements established for each partner  Each set retains own identity, convergence path, etc.  Partnerships can also operate under 1 herdnumber eg MPPs. However is treated as joint venture for Pillar 1 schemes.  In all cases partnerships can benefit from Young Farmers Scheme  In all cases, only one threshold applies to the Partnership for National Reserve and Young Farmer Scheme.  Must apply on line for BPS application in 2015

16 Land eligible for National Reserve Change to Holding Reduction in size of holding Transfer of 2013 owned land without transfer of entitlements Loss of leased/rented land since 2013 Farmers must declare all land available to them in 2015 Result 2013/2015 Rule applies Land not available for NR Land available for NR Land farmed 2013/2014 and 2016???

17 Circumvention Clause  Article 60 of Regulation 1306: Without prejudice to specific provisions no advantage provided for under sectoral agricultural legislation shall be granted in favour of a natural or legal person in respect of whom it is established that the conditions required for obtaining such advantages were created artificially, contrary to the objectives of that legislation  EU Regulations require that all National Reserve applications be examined individually z  Administrative and on-farm inspections on all Schemes including National Reserve and Young Farmers Scheme  Windfall profit Art 28 of 1307,...where the increase would lead to windfall profit for the farmer concerned....

18 Scottish Derogation Farmers who farmed in the Beef, Sheep, Arable or Dairy sectors on 15 th May 2013 and who never held (either owned or leased in) Single Payment Entitlements 2013/2015 rule applies Entitlements allocated at base unit value increasing to 60% of National Average by 2019 Applications available in early April

19 Transfer of Allocation Right & Value

20 What is transferrable Allocation Right: An Allocation Right established in 2013 is the right to be allocated one entitlement on one hectare of eligible land under the Basic Payment Scheme in Reference Value The total value of entitlements owned (held or leased out) by a farmer under the Single Payment Scheme in 2014, and where relevant the value of payment received under the Grassland Sheep Scheme in 2014

21 Changes during Transition 15 May 2013: Farmer establishes Allocation Right 15May 2014: farmer establishes Reference Value 15May 2015: second ‘land’ test: Establishes Entitlements

22 2014 Scheme year Allocation Right automatically transfers for certain types of transfers that were submitted under the 2014 Scheme i.e. change of registration details change of legal entity mergers/scissions 2014 Gift /Inh letters issued to establish if land was transferred with entitlements to enable transfer of allocation right PCC required to continue leasing of land & entitlements

23 2015 Methods of Transfer (Transfer of Allocation Right and Reference Value application form to be submitted) Original Farmer ProcessNew Farmer Sole TraderChange of legal entity CompanyAR (and value) of each sole trader added together FarmerChange of Registration details New Farmer + farmer AR (and value) of original farmer transferred to new farmer Separate farmers MergerOne entityThe AR(and value) held by each original farmer will retain original identity; two or more sets One entityScissionTwo or more farmers The AR(and value) held by the original holding must be divided between the new holdings

24 2015 Transfer by Gift/Inheritance Original Farmerpp ProcessNew Farmer FarmerGiftNew FarmerAR (and value) of original farmer transferred with the land FarmerInheritanceNew FarmerAR (and value) of deceased farmer transferred to beneficiary of the land Transfer of Allocation Right and reference value application form to be submitted

25 Transfer by Sale/Lease Sales and Leases processed by PCC Original Farmer Process Type 1 PCCLease of Land and Entitlements PCC allows for the leased land & entitlements to be included in the calculation of the transferors account and then transferred across to the lessee for period of lease agreement and returned at end of lease Type 2 PCCSale of Land and Entitlements 2015 scheme year PCC allows for the inclusion of the land sold in the calculation of the sellers entitlements, these entitlements will then be transferred permanently to the account of the buyer Type 3 PCCLease/sale of land with Allocation Right PCC Type 3 allows for transfer of Allocation Right with land. Transferee must have no existing Allocation Right

26 Conditions for using Private Contract Clause The TransferorThe Transferee Must hold Allocation right – and Must be ‘active farmer’ in 2015 (at least 1 hectare) – and Must submit a BPS application under the 2015 scheme year Must be ‘active farmer’ and Must submit a BPS application in 2015 and declare land and Must submit a PCC application (with lessor) Standard PCC form is available on Department Website

27 Clawback Sale of entitlements without land 50% clawback in 2016 Not relevant to 2015

28 What Next? Closing date Phase 1 of NR and YFS: 31 March Opening of Phase 2 of NR: 1 April Closing date of all applications: 15 May – All supporting documentation must be submitted (late penalties of 4% per day will apply) May to October: Processing of NR, YFS, PCC, Transfer, Scottish Derogation applications Young Farmers Scheme payments commence in December

29 Thank You


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