What is an Agricultural Tenancy?

An agricultural tenancy is an agreement where a landowner lets someone else use their land for farming.

  • The landowner is called the Landlord
  • The farmer using the land is called the tenant
  • The tenant pays rent in return for being permitted to use the land

This allows people to farm the land without needing to buy it as this can be expensive.

Why are Agricultural Tenancies Important?

Agricultural tenancies help keep farmland in use.

  • The landowners can earn money without farming the and themselves.
  • Farmers can run their business without owning land.
  • It supports food production and rural jobs.

Main types of Agricultural Tenancies

  1. Older tenancies (Agricultural Holdings Act 1986)

These are older agreements created before 1995.  The key aspects are:-

  • Tenants have strong protection.
  • They can often stay for life.
  • Family members may take over the tenancy.
  1. Farm Business Tenancies (FBTs)

These are the most common modern agreements.

  • They are mor flexible and simpler.
  • Usually for a shorter term
  • Rent is based on the open market.
  • Less long-term security for tenants.

What does the Agreement cover?

  • Rent – how much is paid and when, and when it can be reviewed.
  • Use of the land – what can the land be used for and are there any restrictions.
  • Repairs and upkeep – who fixes buildings, fenced and drainage.
  • Length of the tenancy – how long it lasts and how it can be terminated.

What are the advantages of having an Agreement?

For Landowners

  • You can earn a rental income
  • Keep ownership of the land
  • Flexible agreements are an option

For Farmers

  • No need to buy expensive land
  • It’s an easier way to start or grow a farm
  • Can increase or reduce the land use more easily

Conclusion

Agreements are a great way for both landowners and farmers to do what they do best, whilst getting the most out of the land and having their role and relationship unambiguous.

If you would like more information or are in need of an Agreement, our Agricultural Team are ready to support you.

Please contact Samantha Abdoollah, Solicitor on 01756 799000 or [email protected]