SimpleReturns

Company tax returns for farm shops and smallholding businesses

Reviewed by Lee Jones, Founder · Updated 17 July 2026
The short answer

If you run a farm shop, a smallholding selling produce, a livery yard or a small rural business through a limited company, the filing job is the same as for every company in the country: a Company Tax Return to HMRC and accounts to Companies House, even in a loss year. One honest line first: if you run a full working farm through a company, the specialist farming tax rules mean an accountant is the right call. This page is for the simpler rural business: the shop, the box scheme, the market stall, the yard.

Official source. This guide is a plain-English summary of official GOV.UK guidance, not advice. The authoritative source is Company Tax Returns on gov.uk. Always rely on that over our summary.

What counts as your company's income?

Everything customers pay your company. For a rural business it usually comes from several small taps at once, and every one counts, cash or card:

  • takings through the farm shop till
  • veg box schemes and subscriptions
  • market stalls and farmers' market sales
  • eggs, honey, jam, plants or meat sold at the gate
  • livery fees for looking after horses, feed and care included

Your tax is then worked out on the profit left after costs. Small companies pay 19% on profits up to £50,000, and bigger profits move towards 25%.

One honest flag: money from simply letting people use your land or buildings, like glamping pitch fees or a bare field let with no real service attached, can be property income rather than trading income, which goes in a different box on the return. Our guide on property companies covers that side; if your year mixes the two, have an accountant check the split.

VAT works unusually in your favour here. Your company must register once its taxable takings pass £90,000 over any rolling 12 months, not a calendar or accounting year. But most plain food sold for people to eat is zero rated, so no VAT is added to it, while hot food, catering, confectionery and soft drinks are standard rated. A shop selling mostly zero rated food can therefore choose to register early, add nothing to most of its prices, and claim back the VAT on its own costs, which can actually put money back into the business. That choice has real edges, so ask an accountant first.

What can your company claim?

The rule behind every cost is simple: it has to be for the business. For a farm shop or smallholding company the usual list looks like this:

  • Stock and feed. What you buy to sell on or to raise what you sell: shop stock, seed, compost, animal feed, bedding.
  • Machinery and equipment. Chillers and cold room kit, shelving, tills, tools, a ride-on mower. An allowance lets the company claim their full cost against profit in the year you buy them, up to a very high yearly limit. Our guide on claiming equipment goes deeper. One caution: land, buildings and fixed structures do not count as equipment, so before claiming a polytunnel, a barn or anything built into the ground, ask an accountant.
  • The van. A van bought for the business gets that same full first year treatment, and its fuel, servicing and insurance for the work are company costs. Cars do not get it. A company van used only for the work, with nothing beyond the odd insignificant detour, creates no extra personal tax; real private use does. If the vehicle doubles as the family car, or is a pickup rather than a plain van, ask an accountant first.
  • Fencing and repairs. Mending fencing, patching a roof and servicing machinery are repairs, claimable now. Upgrading to something bigger or better is an improvement, which is capital and treated differently.
  • Utilities for the business buildings. Electricity, heating and water for the shop, barn or stables are company costs.
  • Stall and pitch fees. What you pay for your spot at the farmers' market.

Keep the receipts. Every claim is only as good as the paper behind it.

The trap: the farmhouse is your home

On a smallholding the business and your life share a postcode, and this is where directors go wrong. The farmhouse is your home, and the costs of running it, the heating, the kitchen, the broadband, are not company costs, even when the veg boxes get packed on the kitchen table. A cost only reduces the company's tax if it is genuinely the company's: the electricity for the cold room, yes; the farmhouse bills, no. And if the company pays for something really personal, that does not turn into a claim, it turns into a taxable perk for you personally. Keep the two pots of money cleanly apart, and hand anything genuinely mixed to an accountant.

What does filing look like with us?

Your company has three dates to keep apart. The accounts go to Companies House within 9 months of your year end, the Corporation Tax itself is due 9 months and 1 day after the year end, and the Company Tax Return, the CT600, goes to HMRC within 12 months. A late return costs £200 from day one. HMRC's own free filing service has closed, so every company now files through commercial software.

SimpleReturns is built for businesses like yours. You upload the company bank statement and answer a few plain-English questions, no accounting words. You review every figure before anything is sent, then we file both returns: the tax return to HMRC and the accounts to Companies House. Free to start, no card needed, and filing costs £99 flat for both.

Common questions

I run a full working farm through my company. Should I use this?

No. Working farms have specialist rules of their own, like the herd basis for livestock, and that is proper accountant territory. This page suits the simpler rural company.

Should my farm shop register for VAT before it has to?

Maybe. Most plain food is zero rated, so a registered shop can often claim VAT back on its costs without adding VAT to most prices. Ask an accountant to run your numbers.

Can the company pay the farmhouse bills?

No. Your home is yours, not the company's. Company money spent on personal costs becomes a taxable perk, not a claim.

Is glamping income the same as shop income?

Not always. Letting out your land or buildings can be property income, a different box on the return. Ask an accountant to check the split.

Want your farm shop's return filed for you?

You upload the company bank statement and answer a few plain-English questions, no accounting words. We sort the shop takings, stock, feed and equipment costs, work out the profit and the Corporation Tax, and build both filings: the tax return for HMRC and the accounts for Companies House. You review every figure before anything is sent. Free to start, no card needed, and £99 flat covers both.

Start your return

If letting out land or VAT registration is in play, we will flag it plainly so an accountant can sort that one part.

General guidance, not advice. This guide explains how the rules generally work for small UK limited companies. It isn't tax advice for your specific situation, if you're unsure, check with us or an accountant.