That said, farmland and property can be difficult to sell. Also, many other things can happen in life that could affect the future of your farm, such as:
- Long-term care fees
Things to consider
How do you divide your assets fairly when one child works in your farming business and the others work elsewhere?
What happens if you have no private assets other than the farm?
What if you continue working into old age and have children aged into their 50s or beyond with no assets of their own?
Has your farming business been diversified to generate other income streams?
Are you using farming land for property development?
What is the structure of your farming business? Some of the set-ups could be: contract farming, share farming, tenancy farm, partnership, company, LLP, limited partnership, joint venture or profit a prendre. (The structure you choose makes a difference to who owns what.)
Will your successor/s have the necessary skills, knowledge and experience? How will you mentor them to ensure continued success?
Have you sorted everything out in writing, such as your will/s, pre-nuptial agreements and shareholder/partnership agreements?
Have you got pensions and investments to consider?
How we help
In research of 700 farming families a few years ago, it turned out fewer than half had a succession plan in place. We think that’s unwise, not just because a succession plan protects you, your farm and your family, but it also helps support the future of the farming industry.
- You need to think about all your existing assets such as land and buildings (and their residents), as well as the long-term goals for the business and each family member
- You need to know about taxes and tax reliefs such as inheritance tax and capital gains tax, agricultural property relief and business property relief
- If the farm can’t support more than one generation, you may be able turn to charities for support
To start the conversation, it helps to include an expert succession planning consultant.
Many of our solicitors have hands-on farming experience, are from farming backgrounds, and/or are qualified in agricultural law. This means we have real insight into your situation, as well as the relevant legal expertise.