Readers’ forum: Application of BADR to sale of trading assets

A farming partnership is operated through a contract farming arrangement and we are content this is structured such that the partnership would be regarded as ‘trading’ for business asset disposal relief (BADR) and it has been in place for more than two years.

The contract farming arrangement is coming to an end at the end of this year and for the entire 2025 calendar year the farm will be let out. It is expected that another contract farming arrangement which will be ‘BADR compliant’ will be entered into from the beginning of 2026.

There is an intention to sell the farm and depending on when this happens our concern is whether the ‘two year trading’ requirement will have been met. If the current contract farming arrangement comes to an end on 31 December 2024 and the farm is sold on say ...