Set up equestrian or livery services on your farm

Farm equestrian diversification includes livery services, riding schools, trekking, and competition facilities. VAT treatment and licensing requirements vary depending on what services you offer.

The key distinction is between livery (keeping horses for others) and riding services (providing horses for others to ride). Livery alone doesn't require a licence; riding services do.

Planning Permission for Equestrian Use

Planning requirements for equestrian diversification on farms

Grazing horses on agricultural land: Usually no change of use required if ancillary to farming
Commercial livery yard: Change of use likely required - equestrian is Sui Generis
Indoor/outdoor arena: Planning permission required for new construction
Floodlighting: Planning permission required - consider neighbour impact
New stables: Planning permission required unless replacing like-for-like
Horse walker/solarium: Planning permission likely required

Change of use considerations: Agricultural permitted development rights do not extend to commercial equestrian use. Converting farm buildings to commercial stables typically requires planning permission.

Rural location policies: Many local plans support equestrian development in rural areas as appropriate rural enterprise. However, applications near residential properties may face objections over noise, traffic, and odour.

Pre-application advice: Given the investment involved in equestrian facilities, consider paid pre-application advice from your local planning authority before commissioning detailed plans.

Planning permission for equestrian use

Insurance for Farm Diversification

Insurance requirements for diversified farm enterprises

Employers' Liability: LEGAL REQUIREMENT if employing staff - minimum £5 million
Penalty for no EL insurance: Up to £2,500 per day without valid insurance
Public Liability (general): Recommended minimum £5 million
Public Liability (tourism/events): Minimum £10 million recommended
Product Liability (food sales): Covers claims from food products - minimum £2-5 million
Property insurance: Cover for buildings, equipment, and stock
Business interruption: Covers lost income if unable to trade

Key insurance considerations for diversification:

Disclosure: Always inform your agricultural insurer of diversification activities - failure to disclose may invalidate cover
Specialist cover: Some activities (farm tourism, events, food processing) may need specialist policies
Seasonal variations: Cover levels may need adjusting for peak seasons
Combined policies: Farm insurance packages often include diversification options

Review existing farm policy: Check if your current agricultural insurance covers proposed diversification activities. Most don't automatically.
Obtain specialist quotes: For tourism, events, or food processing, get quotes from specialist insurers familiar with rural diversification.
Display certificate: Employers' Liability certificate must be displayed where employees can easily read it.

Business Rates for Farm Diversification

Business rates treatment of diversified farm enterprises

Agricultural land exemption: Agricultural land and buildings are exempt from business rates
Farm shops (own produce only): May remain exempt if selling only own farm's produce
Farm shops (mixed produce): Rateable if selling goods not from the farm
Small business rates relief: 100% relief if RV under £12,000; tapered to £15,000
Rural rate relief: 100% relief for qualifying rural businesses (pop. under 3,000; RV under £16,500)
Holiday accommodation: Business rates apply if let commercially 140+ days per year
Renewable energy installations: Business rates apply to solar arrays, wind turbines, AD plants

Check liability for new activities: Contact your local council's business rates team when starting diversification to understand your liability.
Apply for small business rates relief: If eligible, apply to your local council. Relief is not automatic - you must claim it.
Inform your agricultural insurer: Diversification may not be covered by standard farm insurance. Notify your insurer of all new activities.

VAT for equestrian services

VAT Treatment for Livery Services

VAT classification for different types of livery services on farms

VAT treatment of livery services depends on the type of service provided. Understanding this prevents incorrect VAT charges and HMRC enquiries.

DIY livery: VAT EXEMPT - land rental only, no services
Part livery: STANDARD-RATED (20%) - stable plus some services
Full livery: STANDARD-RATED (20%) - full care provided
Grazing only: VAT EXEMPT - agricultural land rental
Riding lessons: STANDARD-RATED (20%)
Horse hire/trekking: STANDARD-RATED (20%)

DIY livery VAT exemption conditions

DIY livery is only VAT exempt if:

You provide stable/field only - no feeding, mucking out, or exercise
The horse owner has exclusive use of their stable/field space
You provide no significant services beyond basic facilities

If you provide ANY care services (even occasional feeding when owners are away), the whole supply becomes standard-rated.

VAT on livery services

VAT summary by service type

DIY livery: Exempt (letting land for grazing)
Part livery: Standard-rated (significant additional services)
Full livery: Standard-rated (comprehensive care package)
Riding lessons: Standard-rated
Horse hire/trekking: Standard-rated

If you provide mixed services, you may need to apportion VAT. Keep clear records of what each customer is paying for.

Riding establishment licensing

Riding Establishment Licence Requirements

Licensing requirements for riding schools and hire businesses

If you offer riding lessons, horse hire, or trekking, you must hold a Riding Establishment Licence from your local authority under the Riding Establishments Acts 1964 and 1970.

Who needs a licence: Anyone hiring horses for riding, or providing riding instruction for payment
Licence authority: Local authority (district/unitary council)
Licence duration: Annual - must renew each year
Licence fee: Varies by council - typically £150-£400
Inspection requirement: Annual inspection by vet appointed by council
Penalty for operating unlicensed: Criminal offence - fine up to £2,500

Licence conditions typically include:

Horses fit for purpose (health, age, temperament)
Adequate stable and grazing facilities
Qualified supervision at all times
First aid facilities for horses and riders
Safe tack and equipment regularly checked
Fire precautions and emergency procedures
Adequate insurance (see separate snippet)

What doesn't need a licence

DIY livery (owner rides their own horse)
Part/full livery without riding services
Private riding on your own horses (not for hire)
Breeding and selling horses (no riding services)

Apply for riding establishment licence

When you need a licence

You need a riding establishment licence if you:

Offer riding lessons (even informal ones for payment)
Hire out horses for riding
Offer pony trekking
Provide horses for shows or competitions for hire

You do not need a licence for:

Livery services only (no riding instruction or hire)
Grazing agreements
Horse training where you ride the horses yourself

Insurance requirements

Insurance Requirements for Equestrian Businesses

Insurance cover needed for livery and riding businesses

Public Liability (livery only): Minimum £5 million recommended
Public Liability (riding school): Minimum £10 million recommended - many require £15 million
Employers' Liability: £5 million LEGAL REQUIREMENT if employing staff
Professional indemnity: Recommended for instructors - covers teaching negligence
Horse owner insurance: Consider requiring clients to have own third-party cover

Why equestrian insurance is higher

Horses are unpredictable and injuries can be severe. A rider thrown from a horse can suffer life-changing injuries with claims worth millions. Claims involving children are particularly high-value.

Riding school operators: Most insurers and licensing authorities expect £10 million minimum cover. Some membership bodies (BHS, ABRS) require £15 million as condition of approval.

BHS approval and insurance

British Horse Society (BHS) approval is not legally required but provides:

Quality mark for marketing
Access to BHS group insurance schemes
Recognition for staff training qualifications
Some insurers offer better rates for BHS-approved establishments

Minimum cover recommendations

Public liability: £5 million minimum, £10 million recommended
Employers' liability: £10 million (legal requirement if you have staff)
Professional indemnity: If providing instruction
Horse mortality/vets fees: For horses you own
Tack and equipment: Cover for saddles, bridles, etc.

Standard farm insurance rarely covers equestrian activities. You'll need specialist equestrian business insurance.

Planning permission

Equestrian use is generally considered compatible with agricultural land, but significant developments may need permission:

Arenas: Usually need planning permission
Permanent stabling: May need permission depending on scale
Change from agricultural building: Needs permission
Field shelters: Often permitted as agricultural development

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Set up equestrian or livery services on your farm

VAT for equestrian services

VAT summary by service type

Riding establishment licensing

When you need a licence

Insurance requirements

Minimum cover recommendations

Planning permission

Compliance Assistant

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VAT for equestrian services

VAT summary by service type

Riding establishment licensing

When you need a licence

Insurance requirements

Minimum cover recommendations

Planning permission

Related guides in VAT Registration

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