Compensation when you leave an agricultural tenancy
When you leave an agricultural tenancy, you should receive compensation for any improvements you have made to the land as the agricultural tenant. This is true if you give your landlord notice or your landlord asks you to leave. You may be entitled to additional compensation for disturbance. If you have allowed the holding to deteriorate, you may have to pay your landlord compensation. Unless otherwise stated, this page applies to agricultural tenants with limited duration, short limited duration and 1991 Act tenancies.
The law on compensation is complicated, so get legal advice from a solicitor who specialises in agricultural law to make sure you get everything you're entitled to.
Compensation for improvements
If you have carried out improvements to the land, you should be paid compensation for this work when your tenancy ends. This may apply even if you have been evicted for non-payment of rent. However, if required, you must have given your landlord notice or received their permission for the work in order to get the compensation. The page on repairs and improvements for agricultural tenants has more information on this.
Compensation for disturbance
1991 Act tenants may be entitled to compensation for disturbance if their landlord sends them a notice to quit and they have to leave the tenancy. Limited duration and short limited duration tenants will only be entitled to compensation for disturbance if their land is resumed by the landlord to use for a non-agricultural purpose.
Money for the reorganisation of your affairs
If you are a 1991 Act tenant and are entitled to compensation for disturbance, you may also be able to get money to compensate for the 'reorganisation of your affairs'.
Compensation for vacant possession
If your landlord wants to sell the land you rent with vacant possession (that is, without a tenant living there), they can ask you to give them notice to leave and then pay you compensation in return. However, your landlord can't force you to do this if you don't want to leave. Only 1991 Act tenants or tenants whose 1991 Act tenancy has been converted to an LDT are entitled to compensation for vacant possession.
Compensation for the landlord
In certain circumstances, you may have to pay compensation to your landlord when you leave. If you're a 1991 Act tenant, you may have to pay your landlord compensation if you've:
allowed the holding to deteriorate while you've been renting it
not maintained or repaired fixed equipment you were responsible for
been using the land for non-agricultural purposes (such as tourism) and this has caused the land to lose value.
If you have a limited duration agricultural tenancy, you may have to pay your landlord compensation if you've been using the land for non-agricultural purposes (such as tourism) and this has caused the land to lose value.
How much compensation will I get?
The rules governing compensation are complicated - however, your solicitor should be able to tell you whether you are entitled to compensation and how much you are likely to get.
Organisations that help tenants farmers
Last updated: 23 February 2021