Livery for friends

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Nikki D

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Hi, I`m having difficulty finding out the rules and regs which govern allowing friends to stable with you. We have a few friends who stable with us which helps to pay for the keep of our event horses - some pay keep, a couple help out on the yard in lieu. I know many people who do this to help with costs but we have fallen foul of a neighbour who seems determined to get us into trouble with the local council. I`m really reluctant to go down the route of applying for business permission for the relatively small amount of "business" that we do. Does anyone know at what point this sort of activity becomes an actual business?
 
First question is whether the PP for the stables if there is any, specified that they were for personal use only. If they did, then it may be trickier to avoid issues.

Secondly, if PP didnt specify restriction to personal use, then the question arises as to whether the use currently made and the arrangements in place amount to business use.

In planning terms stable is domestic if it is an outhouse or other pertinent belonging to and occupied with a dwelling. Equestrian facilities which are occupied together with a dwelling and which are used only for horses of the residents of the dwelling should be treated as domestic. So once other horses are introduced it gets trickier.

Arguably once money starts changing hands then the authorities could argue it is a business. However, in the same way as VOSA have recently come to their senses and agreed that a pure contribution to costs when taking a lift in someone elses horsebox is not business use, you could argue the case if the monies taken can be shown to be purely a direct contribution towards a proportion of maintenance costs of the stables/grounds.

My concern in your case (and Im not a lawyer so you should seek qualified expert advice from one, since we are talking not just about planning enforcement issues but also potentially business rates! start with BHS helpline if you are a member) is that your post seems to state that the money helps to keep your own horses, ie not just enough to cover the costs of the other horses being there but more on top. Think hard about that one, is that true, does it cover the costs they create AND contribute to the cost of your horses on top, or do you mean that the money just helps towards the general cost of all the horses being there. It may be important to work that out, since one may be seen as the same as the VOSA case- just making sure you arent financially worse off for doing a friend a favour, the other as business use.

It may also be significant whether these are close personal friends or whether some are in effect strangers who have livery with you. If the latter then from an official perspective it is unfair on those local businesses who have to pay business rates to offer livery, for other people to do so without paying the tax.

Finally it may also hinge on how many horses and stables you have, and how many are rented out/used by others. Hopefully you have the vast majority otherwise it may be a sticky wicket.
 
:D

I'm about to open a small livery yard in a few months time. Just making use of the spare grazing and buildings on the farm. If we are sensible then the small income should allow me to only have to go back to work part time once I've finished maternity leave.
However we've gone through all the correct channels. Hired a proper architect - Planning permission and bat survey (!) completed. Hired decent joiners to make sure that the buildings are sound and redid the whole roof etc. Insurance and business rates being organised. Lots of expenses!
Unfortunately the running costs have to be taken into account when it comes to charging for livery, so people like me would be buggered when undercut by people who don't pay business rates etc...
 
pixie said:
:D

I'm about to open a small livery yard in a few months time. Just making use of the spare grazing and buildings on the farm. If we are sensible then the small income should allow me to only have to go back to work part time once I've finished maternity leave.
However we've gone through all the correct channels. Hired a proper architect - Planning permission and bat survey (!) completed. Hired decent joiners to make sure that the buildings are sound and redid the whole roof etc. Insurance and business rates being organised. Lots of expenses!
Unfortunately the running costs have to be taken into account when it comes to charging for livery, so people like me would be buggered when undercut by people who don't pay business rates etc...
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Aggree with this all Round here good yards which are doing it by the the book are being undercut by people doing it by the back door if money changes hands you are running a buisness.
 
We had a girl who paid me for reseeding, topping and management of the land. She also poo picked. In total she paid 10 pounds per week. Council confirmed that this was not enough to be a business! Shropshire council were really helpful and so no business rates were paid. Can't see how we undercut any business!
 
shadowboy said:
Can't see how we undercut any business!
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Really? That's one "business" livery space in a yard that's paying full commercial costs that's not being paid for. I agree your livery isn't paying much less than she would be on a commercial yard. It's the Council who are losing out which means that those who do pay business rates have to contribute just that little bit more from fewer people paying for livery.
 
shadowboy said:
We had a girl who paid me for reseeding, topping and management of the land. She also poo picked. In total she paid 10 pounds per week. Council confirmed that this was not enough to be a business! Shropshire council were really helpful and so no business rates were paid. Can't see how we undercut any business!
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I don't think Pixie is referring to this sort of activity, rather that of the poster who has admitted to having a "few" friends on livery and being paid enough to afford to keep their own horses. If someone is earning enough money to have a profit to pay for the keeping of their own horse then surely this would be seen as a business, and possibly liable for tax.

Most of us have to pay tax on our earnings.
 
I always thought that if you offered DIY you were not required to pay business rates as you were merely renting out stables/fields/facilities. If you offer services in the form of part-livery then I think you may need to pay buniess rates.
 
But tax on earnings would only apply if the op has another job, and that these earnings are liable for tax - I doubt very much in the circumstances described that they would be making enough to pay tax if this was their only income...?

It is a very difficult one as if op went down the 'official' route ie paying business rates/tax/insurance etc they would then have to charge a lot to make it financially viable, and doubt it would be worthwhile.
 
Sidney said:
But tax on earnings would only apply if the op has another job, and that these earnings are liable for tax - I doubt very much in the circumstances described that they would be making enough to pay tax if this was their only income...?

It is a very difficult one as if op went down the 'official' route ie paying business rates/tax/insurance etc they would then have to charge a lot to make it financially viable, and doubt it would be worthwhile.
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Hence my wording "possibly liable" ... as you expressed, we do not know the individuals financial circumstances.

At best I think it is always wise to seek professional advice and speak to the council/ hmrc. If they deem it as not a business (or not taxable) then thats fine - better safe than sorry.
 
Dee o dorant- not really as she didnt want to be on a livery yard! she hated yard politics and would have found grazing elsewhere so no one undercut. Don't forget that there are people out there that just don't want livery
 
Booboos said:
I always thought that if you offered DIY you were not required to pay business rates as you were merely renting out stables/fields/facilities. If you offer services in the form of part-livery then I think you may need to pay buniess rates.
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No this is not the case. You are thinking of VAT - livery services are VAT-able whereas plain DIY livery may be exempt.

The only way of not having to pay full business rates if you are offering livery for money is if you can convince the council it isnt a business (!) - which really means very few liveries, not contributing much and that shown to directly offset costs related to the extra horses there, not also cross subsidising other costs; or get the bill reduced by the small business schemes which can reduce it by up to 50%; or in certain circumstances if you are a farm and take advantage of certain special diversification schemes.
 
shadowboy said:
Dee o dorant- not really as she didnt want to be on a livery yard! she hated yard politics and would have found grazing elsewhere so no one undercut. Don't forget that there are people out there that just don't want livery
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Its still undercutting whoever would have had the income from her renting a field from them...
 
Despite what you say I would have done it again if we still had out land, sadly sold up to move towards the city so she had to move on to another lady and did her horses in the morning in exchange for free grazing. I really don't see a problem with this, and neither did the council in fact I still have the letter somewhere confirming that it was not considered to be in the realms of a business transaction and therefore we had no additional costs. Interesting what their viewpoint would have been if I'd had more on the land...
 
Friends are allowed to exchange favours, thats not a problem, esp if theres only one of them and you are doing swapsies just providing cover for each other. Its when fees are paid and the monies involved start to mount up with multiple liveries then the council and ratings officers might reasonably take the view that if it looks like a commercial livery and acts like one then it is one.
 
I don't have a problem with people not paying rates as long as the have approached the authorities and been told that they don't need to. Its the people who don't bother to find out...
 
Nikki D said:
Hi, I`m having difficulty finding out the rules and regs which govern allowing friends to stable with you. We have a few friends who stable with us which helps to pay for the keep of our event horses - some pay keep, a couple help out on the yard in lieu. I know many people who do this to help with costs but we have fallen foul of a neighbour who seems determined to get us into trouble with the local council. I`m really reluctant to go down the route of applying for business permission for the relatively small amount of "business" that we do. Does anyone know at what point this sort of activity becomes an actual business?
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Unfortunately any stables that are used for horses other than those you own are liable for business rates, even if you do not get paid! It is ridiculous, I know, but if the council find out, then they will come and assess your property and you will also be rated on any riding arenas you may have. We have a huge riding arena but only five stables for liveries. The stables are rated at £200 each and the riding arena is rated at over £2500! It almost makes having the livery quite pointless. This year and last though we have benefited from the small business rates holiday and so didn't have to pay a penny. But it is unlikely to last. :( The stables are rated the same whether you do DIY or full livery.
 
Booboos said:
I always thought that if you offered DIY you were not required to pay business rates as you were merely renting out stables/fields/facilities. If you offer services in the form of part-livery then I think you may need to pay buniess rates.
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The council told me that any stables that were being used for other people's horses were business rateable, even if I was letting them out free! DIY attracts the same level of rates as full livery. That is why it is not worth doing in some cases.

ETA: Even empty stables are ratable if you intend letting them out. When I first got assessed I only had two liveries but had to pay rates on five stables.
 
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