Renting farmland
Farm tenancies: renting land in or out
The main kinds of farm tenancy in England, what each side should agree in writing, how tenancies work with SFI and Countryside Stewardship, and where to get help if things go wrong.
Get advice before you sign. A tenancy can tie up land for years, and the wrong kind can give rights you didn't mean to give (or lose ones you need). Have a solicitor or land agent who knows farm tenancies check it first.
The kinds of tenancy
Most new lets Farm Business Tenancy (FBT)
- Under the Agricultural Tenancies Act 1995. Almost every farm let since 1 September 1995 is an FBT.
- You agree the length, rent and repairs. There's no right for the tenant's family to take it over.
- A tenancy of more than 2 years doesn't end on its end date unless at least 12 months' (and less than 24 months') written notice is given. Without notice it carries on from year to year.
- Rent reviews follow the tenancy, or every 3 years by law if it says nothing, at an open-market rent.
- At the end, a tenant can claim compensation for improvements the landlord agreed to in writing.
- The land keeps 100% Agricultural Property Relief for the landlord's inheritance tax. See Passing on the farm.
Older lets Agricultural Holdings Act 1986 tenancies (AHA)
- Tenancies from before September 1995. The tenant has security for life, and the rent is set on the 1986 Act's rules.
- Many allow up to two successions: a close relative who has earned their living mainly from the holding can apply to take it over when the tenant dies or retires. There are tests on eligibility and suitability, and strict time limits.
- Notices, rent reviews and successions all have their own forms and deadlines. Take advice early, as missing a deadline can lose the right.
- A landlord's land let on an old tenancy may only get 50% Agricultural Property Relief. Check with your adviser.
Short lets Grazing licences, mowing and contract farming
- Grazing or mowing licences for less than a year give the right to graze or cut, but not to farm the land. They suit a season's keep. A "licence" that is really a tenancy in practice can be treated as one, so get the wording right.
- Contract farming: the landowner stays the farmer and hires a contractor for the work, sharing the profit. The owner keeps control, scheme payments and inheritance tax relief on the business.
- Share farming: two separate businesses share the output of one farm, each bringing their own part (land, machinery, labour, stock).
What to agree in writing
- Who pays for and does repairs and maintenance: buildings, fences, hedges, drains, water supplies.
- What the land can be used for, and whether the tenant can diversify (a farm shop, camping, solar panels) or sublet.
- Who can enter environmental schemes (SFI, Countryside Stewardship, woodland, carbon or nature deals), and who keeps the money. Long carbon and nature agreements can outlast a tenancy, so agree them first.
- Rent, when it's reviewed and how, and any break clauses.
- Who holds which numbers and registrations: the SBI and land on the Rural Payments service, CPH numbers, and any NVZ or water abstraction records.
- What happens to improvements, dilapidations and payments at the end.
Tenancies and farm schemes
- Sustainable Farming Incentive: the tenant (the person farming the land) applies. Defra says tenants don't need the landlord's consent, but must have management control of the land for the whole 3-year agreement, and the tenancy's terms come first. Tell your landlord anyway.
- Countryside Stewardship usually needs the landlord's consent, and the landlord may need to sign too if the tenancy ends before the agreement does.
- Woodland, carbon and nature credits change the land for decades. They need the landlord's agreement and usually the landlord's signature.
- Use Find funding to see which schemes fit the land, and the My details page for your SBI and CPH numbers.
If there's a problem
- The voluntary Agricultural Landlord and Tenant Code of Practice sets out how both sides should behave: talking early, being clear about rents and repairs, and treating each other fairly. Read the code (PDF)
- The Commissioner for the Tenant Farming Sector can be told about conduct that's unfair or goes against the code, by tenants, landlords or their advisers. What the commissioner does · Raise an issue
- Disputes on rent or the tenancy terms usually go to an independent expert or arbitrator, as the tenancy or the law says. Mediation is often quicker and cheaper.
- Help: the Tenant Farmers Association (tenants), the CLA (landowners), the NFU, a land agent who's a CAAV or RICS member, and the Farming Community Network (fcn.org.uk, 03000 111 999) for support when it's hard.
Official pages: Agricultural Tenancies Act 1995 · Agricultural Holdings Act 1986 · Government response to the Rock Review
This page is general guidance for England, not legal advice. Wales, Scotland and Northern Ireland have their own tenancy laws.