There are many benefits from owning a woodland, many of them intangible (e.g. conservation, recreation etc), but also the tangible benefits associated with investment and tax mitigation.

All of the woodlands we sell will have investment potential in both the timber production and the capital appreciation of the land. The relative importance of these two elements varies enormously with different woodlands.

Most of the smaller and ‘conservation type’ of woodlands will have a much higher intrinsic value as a woodland, i.e. with the trees still on it, rather than the sum of the two separate elements of timber and land. Therefore it is usually far better financially to maintain these woods with a tree cover than it is to clear the timber and sell it.

However, if a woodland is a true commercial forest then the timber element may be of overriding financial significance and management of the woodland may be to maximise the potential timber production.

Woodland values are far less volatile than many more traditional financial market investments and complement any portfolio. The long term nature of a woodland investment provides a high degree of stability and growth patterns are historically very reliable.

The value of a woodland investment can be further complemented by several tax advantages and opportunities (see below).

WOODLANDS AND TAXATION

Woods 4 Sale are not investment or taxation advisors and you should check with a suitable specialist (e.g. accountant, investment advisor) over your individual circumstances and requirements.

Inheritance Tax (IHT)

Forestry qualifies for 100% relief from IHT once you have owned it for more than 2 years. This includes the value of the land and the trees.

The major significance of this is that there is no need to make a lifetime gift of the woodland.

Also, upon death all Capital Gains Tax liability held or rolled over is extinguished.

Capital Gains Tax (CGT)

Timber sales and increases in value of growing timber are completely free of CGT. However, the increase in the value of the land is liable to CGT.

A great advantage of woodland purchases is the opportunity to “roll over” any CGT liability that you may have over a 7 year window. The CGT liability could come from profit made from any source.

Income Tax (IT)

All incomes generated from a commercially managed woodland are completely free of income tax and corporation tax.

No income tax is liable from sales of timber or entire woodlands.