Solar power station farmland compensation

How does a solar farm project work?

It assumes that the solar farm site will be leased to the developer or an investor, and the developer will fund the application for planning permission and construction of the solar farm. The landowner will be entitled to rental income from the project which is likely to be linked to revenue from the site.

What are the tax implications of renting land for a solar farm?

What are the tax implications? Renting land for a solar farm is a commercial lease and is not an agricultural use, so Agricultural Property Relief from inheritance tax may be lost.

Should a landowner give rights to a solar farm?

When granting solar farm options, landowners should be careful not to give rights which are too extensive to any developer, or tie up the land for more time than is necessary – at least not without receiving something adequate in return.

Do I need tax advice before constructing a solar farm?

Tax: where the land is currently used for the purpose of an agricultural trade there are various tax implications which could result in the loss of tax reliefs. It is therefore important to seek tax advice before constructing the project. Please see our article Solar farms: tax considerations for landowners for more information.

Can I rent land for a solar farm?

Renting land for a solar farm is a commercial lease and is not an agricultural use, so Agricultural Property Relief from inheritance tax may be lost. Transferring ownership of the land to another individual or trading entity before any development starts may be worth considering, to minimise the tax implications, but seek professional advice.

What are the requirements for a solar farm?

Solar Farm Requirements: The parcel of land being considered for solar farming must be big enough. Solar farms need quite a lot of space. The biggest solar farm in the UK can produce a total of 46 MW of power and is capable of powering 14,000 homes.