The next phase of the Sustainable Farming Incentive (SFI) reopened in June for small farms and those without an existing Environmental Land Management (ELM) agreement.

There are 71 funded actions, simplified from the previous 102, which pay farmers to adopt practical environmental management measures.

Each action is aimed at protecting and benefitting the environment, improving productivity and supporting food production.

For those who miss out on this first window of funding worth £60 million, the second window has triple the base budget and is expected to open in September.

Am I eligible to apply?

The farms eligible to apply for Window one are those who have received a Single Business Identifier (SBI) before January 2026, are without an existing ELM and are classified as a small farm (up to 50 hectares).

In preparation, Defra is advising farmers to check that all land parcels they wish to include in their application are correctly shown on their digital maps.

If there needs to be mapping changes, they should be requested through the Rural Payments service as soon as possible.

If you are eligible, you can submit your application online through the Rural Payments service and select the actions you want to include in your agreement.

Farm businesses are only entitled to one SFI26 agreement with a maximum value of £100,000 per agreement year.

What if I miss out?

While this incentive only re-opened on 30 June, Defra announced a couple of weeks later that around 75 per cent of funding for the first window has already been allocated.

Defra are urging people to submit applications for funding as soon to avoid missing out, with money being allocated on a first come first served basis.

However, do not worry if you do miss out on this first window, as a second window for funding opportunities is expected to open in September.

While the first window was exclusive to smaller farms and those without an existing ELM, the second is open to all remaining eligible farmers and land managers.

Follow-up

If you don’t want to miss out on funding, reaching out to an accountant can help you ensure that your application is accurate and that SFI payments are in line with your business strategy.

Also, an accountant can help you understand how these grants can affect the cash flow of your farm.

Contact our team today to discuss your application.