It was reported last week that the Patron Saint of OCD Cleaners Sir James Dyson now owns more land in England than the Queen.
The headline was slightly disingenuous and if you analyse the story it’s more interesting than a rich man buying up acres of our green and pleasant land.
It’s disingenuous because it conveniently overlooks the land Her Majesty owns in her capacity as The Duke of Lancaster.
If you add in the Duchy Estate the Queen still owns more acres than Sir James.
It’s interesting because what Sir James is doing is not just buying land. He has been systematically buying up large swathes of farm land in rural Lincoln. Why?
He may well enjoy life on the farm and indeed in a recent newspaper interview he talked about his own childhood in the Norfolk countryside and how he spent holidays working on local farms and as such is enjoying being a farmer on the equally flat landscape of Lincolnshire.
But I’m sure Sir James has also taken his advice from his solicitor about the tax benefits of owning agricultural land.
Sir James is a rich man as such as and when he dies the tax man will have an interest in his estate with a view to skimming off some Inheritance Tax.
In basic terms Inheritance Tax is payable at a rate of 40 per cent on assets passing on death over the threshold of £325,000.00.
However, there are some exemptions and reliefs to the invidious death duty and one is in respect of agricultural property.
So what Sir James is doing is buying up a very handy tax shelter.
Agricultural property relief to Inheritance Tax is vitally important as it helps protects farms from having to be broken up and sold on death and underpins our agricultural economy.
It wasn’t designed to protect the wealth of industrialists like Sir James but if he is investing in the rural economy I suppose it’s fair game (pun intended).
Another outcome of Sir James buying up significant parts of Lincolnshire is that land values in the county have shot up; which is good news for any farmers wanting to sell up and a virtuous circle for the man who likes to clean up.