Section 41: Rates charged by reference to annual value of agricultural land and buildings., Land Drainage Act 1991

Subject to section 38 above and section 47 below, a rate made by the drainage board for an internal drainage district shall be assessed at a uniform amount per pound throughout the district on the annual value of the agricultural land or agricultural buildings in respect of which it is made.

For the purposes of this Chapter the annual value of any chargeable property shall (subject to sections 43 and 44 below) be the amount, determined in accordance with section 42 below, which is equal to the yearly rent, in respect of a holding comprising the chargeable property, at which the holding might reasonably be expected to have been let, by a prudent and willing landlord to a prudent and willing tenant, on a tenancy from year to year commencing on 1st April 1988 and on the relevant terms. This is subject to section 41A below.

For the purposes of subsection (2) above chargeable property is let on the relevant terms if—

the tenancy incorporates the terms set out in subsection (4) below; and

the property is let on the terms relating to maintenance, repair and insurance of fixed equipment which are set out in the Schedule to the Agriculture (Maintenance, Repair and Insurance of Fixed Equipment) Regulations 1973.

The terms mentioned in subsection (3)(a) above are—

a covenant by the tenant, in the event of the destruction by fire of harvested crops grown on the holding for consumption on it, to return to the holding the full equivalent manurial value of the crops destroyed, in so far as the return of that value is required for the fulfilment of his responsibilities to farm in accordance with the rules of good husbandry;

a covenant by the tenant to insure against damage by fire all dead stock on the holding and all harvested crops grown on the holding for consumption on it;

a power for the landlord to re-enter on the holding in the event of the tenant not performing his obligations under the tenancy agreement;

a covenant by the tenant not to assign sub-let or part with possession of the holding or any part of it without the landlord's consent in writing.

In determining for the purposes of subsection (2) above the yearly rents at which a property might reasonably be expected to have been let, any liability for the payment of drainage rates shall be disregarded, but account shall be taken of all other relevant factors, including, in every case—

the character and situation of the holding (including the locality in which it is situated);

the productive capacity of the holding and its related earning capacity; and

the level of rents for comparable lettings current on 1st April 1988.

In determining for the purposes of subsection (5) above the level of rents current on 1st April 1988 for comparable lettings—

account may be taken of any available evidence with respect to the rents which are or were payable in respect of tenancies of comparable agricultural holdings on terms (other than terms fixing the rent payable) similar to those assumed for the holding in question; but

the following shall be disregarded—

any element of the rents in question which is due to appreciable scarcity of comparable holdings available for letting on such terms compared with the number of persons seeking to become tenants of such holdings on such terms;

any element of those rents which is due to the fact that the tenant of, or a person tendering for, a comparable holding is in occupation of other land in the vicinity of that holding that may conveniently be occupied with that holding; and

any effect on those rents which is due to any allowances or reductions made in consideration of the charging of premiums.

In this section—

"productive capacity", in relation to a holding, means the productive capacity of the holding determined (taking into account fixed equipment and any other available facilities on the holding) on the assumption that the holding is in the occupation of a competent tenant practising a system of farming suitable to the holding; and
"related earning capacity", in relation to the productive capacity of a holding, means the extent to which, in the light of that productive capacity, a competent tenant practising such a system of farming could reasonably be expected to profit from farming that holding.

Section 41: Rates charged by reference to annual value of agricultural land and buildings.

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