Farm transfers and succession planning are amongst the biggest decisions a Farmer will have to make in the course of their lifetime. Farm Succession Planning should be a collaborative process and should include discussions between the family, Accountants, Famer Consultants and Solicitors.
Succession planning should not be left until the last minute, i.e. the eve of the young farmer’s 35th birthday. Given the nature of Irish farms and how they tend to operate there will be a number of issues that will require careful consideration including, the retiring farmer’s needs from both a financial and personal, the family situation, tax implications and finances.
As mentioned above, successful farm transfers or succession plans will involve collaboration between your Accountant, Agricultural Advisor and Solicitor. They should ask the relevant questions in order to understand exactly what it is all of the parties expect to get out of the transaction and once they have established this, figure out the best way to achieve the desired goals.
We have set out some of the most common questions/considerations that generally arise below:
- Is there an obvious successor or child who is interested in farming?
- Do I want my successor to pay consideration for the lands, stock and machinery?
- If there is more than one child do I want to carve out sites for those children who won’t be involved in the farming enterprise?
- What are my future needs from a financial perspective?
- Is the family home on the farm?
- Is this to be transferred with the farm or carved out?
- If it is to remain with the farm are rights or residence and maintenance to be reserved?
- Will this affect the Fair Deal Scheme?
- What does the working relationship look like following the transfer?
The sooner you start talking through the points above, both informally within the family and more formally with your professional advisors the better. Clarity is key, avoid ambiguity and ensure that everyone is on the same page in terms of their expectations.
For more advice please contact our office on 051 874909.