Decide whether to trade as a sole trader, limited company, or partnership. Many farms operate as partnerships or family companies to manage succession and liability.
All agricultural land holdings in England must be registered with the Rural Payments Agency (RPA) to access farming schemes and payments. You'll receive a Single Business Identifier (SBI) number which is your unique farm reference.
Registration involves mapping your land parcels digitally through the Rural Payments service. You'll need to identify field boundaries, land use types, landscape features (hedgerows, ponds, walls), and any environmental designations. Individual schemes set their own eligibility rules (for example, the reformed SFI 2026 has a 3-hectare minimum).
County Parish Holding (CPH) numbers: If you keep cattle, bison, buffalo, pigs, goats, sheep, deer, or 50 or more poultry, you must also register for a CPH number from the RPA. You need a CPH before moving those animals onto your holding. Each separate piece of land needs its own CPH if it's not physically contiguous.
What you can do with an SBI: Apply for SFI (Sustainable Farming Incentive), Countryside Stewardship, capital grants, animal health reviews, and other farming schemes. Your SBI links your business to your land and forms the basis of all RPA interactions.
Applies to: All farmers and landowners with agricultural land in England who want to access farming payments and schemes
Official guidance (opens in a new tab)
Create an RPA account and register your agricultural land to receive your SBI number. You'll need field maps, land ownership evidence, and OS grid references.
If you keep cattle, bison, buffalo, pigs, goats, sheep or deer - even one animal - you must register for a County Parish Holding (CPH) number before moving animals onto your land. Poultry keepers must register if they keep 50 or more birds.
A CPH identifies the geographic location of your livestock. Each separate piece of land needs its own CPH if not contiguous. In England you apply to the Rural Payments Agency for your CPH, then register as a keeper with the Animal and Plant Health Agency (APHA) before moving animals onto the holding.
Livestock-specific registrations:
Cattle: Register as a keeper with BCMS (British Cattle Movement Service), maintain herd register, report all cattle movements within 3 days, keep cattle passportsSheep and goats: Hold flock/herd mark, register holding, report the annual sheep/goat inventory (count on 1 December, return by 31 December), tag animals before moving off-holdingPigs: Tell APHA within 30 days of pigs arriving, tag pigs before moving, keep movement recordsPoultry: Register if you keep 50 or more birdsFailure to register or maintain livestock records is a criminal offence and can result in prosecution, movement restrictions, and loss of farming payments.
Applies to: Keepers of cattle, bison, buffalo, pigs, goats, sheep or deer in Great Britain, including anyone keeping one animal for non-commercial purposes; poultry keepers with 50 or more birds.
Official guidance (opens in a new tab)
Livestock registration requirements
Keeping cattle, sheep, pigs or other livestock requires CPH registration, movement reporting, and animal identification.
A County Parish Holding (CPH) number is a 9-digit unique identifier required before keeping any livestock in England. It identifies the land where animals are kept.
CPH format
XX/XXX/XXXX (county code / parish code / holding number)
Who needs a CPH
Anyone keeping cattle, sheep, goats, pigs, deer, or poultry (since 1 October 2024 all bird keepers must register regardless of flock size)
Includes
Pet livestock, hobby animals, and commercial herds/flocks
Application timing
Apply maximum 6 weeks before livestock arrive
Processing time
Within 10 working days by email
Cost
Free
How to apply - online
Via Rural Payments service (if not already registered)
How to apply - phone
03000 200 301 (RPA helpline)
Apply through the Rural Payments Agency before moving any livestock onto your holding. You'll need your address, OS grid reference, and land size.
All farming businesses must register with HMRC for tax. Sole traders and partnerships use Self Assessment. Limited companies register for Corporation Tax.
Farmers can average their profits over 2 or 5 years for income tax purposes. This reduces tax bills in high-profit years and smooths the impact of volatile farming income. You claim averaging through your Self Assessment tax return.
Official guidance (opens in a new tab)
Farming businesses need specific cover: public liability (essential), employer's liability (if you have workers), farm buildings and stock, and agricultural vehicle insurance.
Insurance for farming businesses
Farms face unique risks from livestock, machinery, and public access. Get specialist agricultural insurance covering buildings, stock, equipment, and liability.
UK businesses need different types of insurance depending on their activities. Some are legally required, others are contractually required, and some are optional but prudent. Understanding the differences helps ensure adequate protection.
Employers' Liability
LEGALLY REQUIRED if you employ anyone. Minimum £5m cover. Protects against employee injury/illness claims.
Motor Insurance
LEGALLY REQUIRED for any vehicle used for business. Criminal offence to drive uninsured.
Professional Indemnity
Required for some regulated professions under their profession-specific rules, including many solicitors, financial advisers and architects. Covers negligent advice claims.
Public Liability
NOT legally required but often contractually required by clients. Covers third-party injury/damage claims.
Products Liability
NOT legally required but essential for manufacturers and retailers. Covers claims from defective products.
Business Contents
NOT required but recommended. Covers theft, fire, damage to business assets.
Business Interruption
NOT required but recommended. Covers lost income when you cannot trade.
Cyber Insurance
Increasingly important. Covers data breaches, ransomware, GDPR fines.
Key Person
Optional. Compensates business if critical person dies or is incapacitated.
Choosing the right cover: Do you employ anyone? Employers' Liability is legally requiredDo you use vehicles for work? Business motor insurance is legally requiredAre you a regulated professional? Check your regulator's profession-specific Professional Indemnity rulesDo you interact with customers or visit premises? Public Liability is practically essentialDo you sell physical products? Products Liability is strongly recommended
Cross-compliance ended on 31 December 2023, and England has no 'conditionality' regime. What applies now is a combination of:
Baseline domestic law that binds every farm regardless of scheme membership - Farming Rules for Water, NVZ rules, the Management of Hedgerows (England) Regulations 2024 (2-metre buffer strips and a 1 March - 31 August cutting ban, enforced by the RPA), environmental permits, and animal identification and welfare lawScheme agreement terms: if you hold an SFI or Countryside Stewardship agreement, you must deliver the actions you signed up forThe RPA takes an advice-led approach: minor first-time issues normally result in guidance, while breaches of agreement terms can lead to payment recovery or agreement termination, and breaches of the underlying law can be prosecuted.
Applies to: All farmers in England; agreement terms apply to recipients of SFI, Countryside Stewardship, or other agri-environment payments
Official guidance (opens in a new tab)
Environmental compliance baseline
Baseline legal rules on water, soil, hedgerows and animal welfare apply to all farms; scheme agreements add their own terms, with payment recovery or termination for breach.
Cross-compliance ended in England on 31 December 2023, when delinked payments replaced the Basic Payment Scheme. It was not replaced by an EU-style "conditionality" regime — there are no GAEC or SMR standards in England, and no percentage payment-reduction matrix.
What applies instead
Baseline law that applies to every farm: the Farming Rules for Water, Nitrate Vulnerable Zone rules, the Management of Hedgerows (England) Regulations 2024 (2-metre buffer strips from the hedge centre and no cutting from 1 March to 31 August), slurry and fuel storage standards (SSAFO), environmental permits, and animal identification and welfare law.Scheme agreement terms: if you hold an SFI or Countryside Stewardship agreement, you must deliver the actions you are paid for. The Rural Payments Agency takes an advice-led approach; breaches of agreement terms can lead to recovery of payments or termination of the agreement.
Enforcement
The underlying rules are enforced directly by the responsible regulators — the Environment Agency, APHA, the RPA (hedgerow rules and scheme terms) and local authorities — through advice, civil sanctions and, for serious breaches, prosecution.
Cross-compliance end date
31 December 2023 (England); delinked payments from 1 January 2024 carry no land-management conditions
Hedgerows
Management of Hedgerows (England) Regulations 2024 — 2m buffer strips from the hedge centre; no cutting 1 March to 31 August (RPA enforces with civil sanctions)
Water and nutrients
Farming Rules for Water and NVZ rules continue to apply directly
Scheme agreements
SFI and Countryside Stewardship breaches are handled by payment recovery or agreement termination, not percentage reductions
Scotland
Scotland retains cross-compliance alongside its Basic Payment Scheme
Rules for farmers and land managers (opens in a new tab)
Standard VAT threshold is £90,000, but farms have special schemes: Agricultural Flat Rate Scheme (FRS) lets you reclaim 4% VAT without full registration. Consider voluntary registration to reclaim VAT on major purchases (machinery, buildings).
The Agricultural Flat Rate Scheme (FRS) lets farmers reclaim 4% VAT on purchases without registering for VAT or submitting VAT returns. You add 4% to your selling prices to cover VAT, and keep it. This compensates for VAT paid on inputs. You can't use FRS if turnover exceeds £150,000 or if you're already VAT registered.
Official guidance (opens in a new tab)
Register as an employer before your first payday. In Wales, Scotland and Northern Ireland agricultural minimum wage rules still apply (England abolished its Agricultural Wages Board in 2013, so National Minimum/Living Wage applies).
Health and safety on farms
Agriculture has one of the highest rates of workplace injury. Ensure proper training, guarding on machinery, safe chemical storage, and livestock handling facilities.
Written policy (5+ employees)
Required by law - must record your health and safety policy
Risk assessment
All employers must assess workplace risks and act on findings
Employers' Liability insurance
Mandatory £5 million minimum cover (£2,500/day penalty)
First aid provision
Assess needs and provide appropriate equipment and trained staff
Accident book (RIDDOR)
Record injuries and report serious incidents to HSE
HSE - Getting started with health and safety (opens in a new tab)
HSE guidance for agriculture covers machinery safety, livestock handling, chemical storage, confined spaces, working at height, and lone working.
SFI is closed to new applications until its 2026 windows: 30 June 2026 (small farms of 50 hectares or less and/or no existing ELM agreement, minimum 3 hectares) and September 2026 (all farms). The reformed SFI 2026 offers 71 actions with a £100,000 cap per agreement year.
Sustainable Farming Incentive overview
Delinked payments replaced the Basic Payment Scheme from 2024 and end after 2027; SFI pays for environmental land management actions - from soil management to hedgerows to IPM. Payments are quarterly.
Current status
Window 1 closed at 11:59pm on 28 August 2026. Window 2 has not yet opened - Defra expects it from 22 September 2026
Reopening
Window 1 ran from 30 June to 28 August 2026 (small farms of 50 hectares or less and/or those without an ELM revenue agreement); Window 2 (all eligible farmers and land managers) is expected from 22 September 2026
Existing agreements
Continue as normal - no action required
Late applicant cap
£9,300 per year maximum for those who applied after closure announcement
Agreement length
3 years
Number of actions
71 actions in the SFI 2026 offer (102 under existing SFI 2024 agreements)
Minimum land requirement
3 hectares of eligible land (SFI 2026)
Agreement value cap (SFI 2026)
£100,000 per agreement year, one agreement per business
Payment structure
Annual payments per hectare or per unit
Example payments (SFI 2024 rates)
£58/ha improved grassland soils, £382/ha herbal leys (£224/ha in SFI 2026), £129/ha multi-species winter cover crops
Compatibility
Can combine with Countryside Stewardship (no duplicate payments for the same action on the same land)
SFI is England's entry-level environmental land management scheme, funded under powers in section 1 of the Agriculture Act 2020.
Common SFI actions and annual payment rates (SFI 2024, valid for existing agreements) Soils:
Assess soil, test soil organic matter, produce soil management plan (CSAM1): £6/ha plus £97 per agreement (removed in SFI 2026) Improved grassland soils (no bare soil, multi-species sward): £58/ha Multi-species winter cover crops (CSAM2): £129/ha Nutrients and grassland:
Herbal leys (CSAM3): £382/ha (£224/ha in SFI 2026) Manage grassland with very low nutrient inputs (CLIG3): £151/ha Hedgerows and boundaries:
Assess and record hedgerow condition (CHRW1): £5/100m (removed in SFI 2026) Manage hedgerows (CHRW2): £13/100m Maintain field corners and buffers: £590/ha Integrated pest management:
Flower-rich grass margins: £798/ha Winter bird food (CAHL2): £853/ha (£648/ha in SFI 2026) Farmland wildlife:
Nesting plots for lapwing and stone curlew: £474/ha Supplementary feeding for farmland birds: £827/ha
Eligibility requirements
Manage agricultural land in England and have control of the land for the 3-year agreement
Action selection options
Select from the available actions (71 in the SFI 2026 offer) based on your farm type, land, and management objectives
Application method
Submit application through Rural Payments portal specifying chosen actions and land parcels
Agreement offer process
RPA will assess application and send agreement offer with payment rates and requirements
Agreement commencement
Accept agreement and begin delivering actions from agreement start date
Annual claim process
Submit annual claim each year to receive payment for delivering agreed actions
Sustainable Farming Incentive (opens in a new tab)