Real issues need careful consideration, time and discussion, writes Niall Treanor B&T Drystock Advisor, Teagasc Galway/Clare.
The movement of the family farm from one generation to the next is one of these serious issues, ‘Fail to prepare, prepare to fail’. Farm succession is an area where there are complex issues and is often treated as the elephant in the room on a lot of family farms. The conversation is difficult and so are the legal and taxation rules that go along with it.
If you fail to put a plan in place for this, prepare to fail. With this in mind, Teagasc are organising an event on March 4th at the Teagasc Centre, Ballinasloe commencing at 8:00pm to address a number of issues that are involved in family farms around succession, inheritance and options for younger people starting off in farming.
A number of professionals, which include solicitors and accountants, will be there on the night as well as your local Teagasc Adviser.
There is ‘no one size fits all’ approach when it comes to the transfer of the family farm and each farm and family have different issues that need to be addressed. The transferring of a family farm is not an easy task as the family home is usually part of the farm and there can be several people involved in most farms.
To help with making a decision, a person’s immediate family and successor should be involved, and the issue should be discussed with them openly so there are no misgivings about the situation.
Good communication within a family will help to prevent a lot of problems in years to come as everyone will know what is happening and reasons behind the decisions that are being made.
For a person at the beginning of their career in farming it is a difficult journey with many ups and downs and a difficult route to take.
Opportunities to start farming in your own right or to expand your business are limited. Macra na Feirme has set up a Land Mobility Service for existing and potential farmers that matches farmers with others where there is interest in collaborative agreements such as land lease, partnerships and contract rearing.
Macra na Feirme will have a speaker on the night to talk about this service that they offer; this service is also useful for people with land that have not identified a successor and are looking at stepping back from farming.
Transferring ownership or responsibility of a farm can have a number of significant financial implications on both the owner and the person receiving it. These include having to pay Capital Acquisitions Tax, Capital Gains Tax, Stamp Duty, increase in income tax, tax credits or reliefs and pensions.
Each family should consult with their solicitor and accountant before making any decision as the legal and taxation issues are quite complex and an expert is needed.