Farmers across Wales now have a clear timetable for the end of direct payments. Welsh Ministers have signed regulations that start tapering the Basic Payment Scheme (BPS) from 1 January 2026 and close it on 31 December 2028. The instrument, made on 3 December 2025 and published on legislation.gov.uk, is signed by Deputy First Minister Huw Irranca‑Davies.

The new law doesn’t set rates for the taper. Instead, it gives Ministers the power to reduce annual BPS payments by whatever amounts they judge appropriate each year until the scheme shuts. That means the headline numbers will come later, but the direction of travel is fixed and the dates are firm.

From 2026, entitlement trading changes sharply. Each payment entitlement can only be transferred if it moves with an eligible hectare in the same transaction and from the same transferor. In plain terms, the days of buying or selling ‘naked’ entitlements are over in Wales. Land agents expect quieter winter trading and tighter paperwork as transfers are tied to mapped land parcels.

Young Farmer Payment is effectively closed to first‑time applicants. Only those already receiving the top‑up before 1 January 2026 will continue to get it under the direct payments rules. New entrants in Wales will have to plan without that route while looking to whatever replaces BPS support after 2028.

The national and regional reserves are being wound down. The regulations scrap the mechanism that previously allowed entitlements to be created from reserve pots, removing a back‑stop that some businesses relied on after mergers, inheritance or tenancy changes.

Administrative levers are also re‑set. Ministers now have more discretion over Wales’s annual BPS ceiling and when adjustments are made within the payment cycle. The shift from ‘must’ to ‘may’ in key clauses gives room to alter totals and timing before payments go out, which could affect cash‑flow for farm businesses and suppliers.

Crucially, the rules keep a safety net for legacy claims. Even after closure, the revoked provisions continue to operate as needed to finalise outstanding rights and liabilities for claim years ending on or before 31 December 2028. That matters for any appeals, inspections or mapping corrections still in train.

Why this matters on our side of the border: livestock and feed businesses in the North buy and sell heavily through Welsh marts at Welshpool, Ruthin and Mold, and many contractors work both sides of Offa’s Dyke. A three‑year taper means tighter margins in the Welsh uplands, which can ripple into store prices, grazing lets and haulage in Cheshire, Shropshire, Lancashire and Cumbria.

For farm managers, the job now is practical. Check that any planned entitlement transfers in 2026 are bundled with the correct eligible hectares. Update cash‑flow forecasts for 2026–2028 assuming a step‑down in BPS, speak early to lenders, and make sure RPW Online details and maps are accurate well before the spring claim window.

The Welsh Government has published a Regulatory Impact Assessment alongside the instrument, signalling further guidance to come. The key facts, though, are already locked in law: taper from 1 January 2026, entitlements only with land, no new Young Farmer Payment claims, and full closure of BPS on 31 December 2028.