PLANNING FOR THE FUTURE OF YOUR FARM
Everyone is advised to make a will and revise it regularly. But that message is all the more important for farmers as ‘succession planning’ can be complex and costly if not looked at carefully, warned Lantra Sector Skills Council today (19 May 2010).
The majority of farming businesses are family based, and the careful planning of succession is important to ensure that the business survives and thrives. However, many families fail to plan succession for a number of reasons, particularly as it can involve discussing difficult issues. But Yorkshire farmer Ian Woodhead was inspired to take action by a special succession planning advisory session arranged by Milbank Consulting with funding from Lantra’s LandSkills Yorkshire and Humber project, part of the Rural Development Programme for England. Ian, who farms just a few miles outside Thirsk, took steps immediately to update his will and other financial arrangements. He would urge other farmers to follow suit - otherwise their successors might end up paying inheritance tax and other costs unnecessarily. “I was interested because it was about succession and death duties. The session was an education and kicked me into gear to do something straight away,” he explains. The meeting was held at Thirsk Farmers Auction Mart, a building Ian designed and where he is director, as well as running a 2600-acre sheep and cattle farm nearby. “You’re asked where you are with your paperwork in legal terms - if you’re not straight the taxman gets hold of the inheritance! I already had plans afoot and had a will, but that was last updated seven years ago so I’ve done it all again. You’re supposed to review every three years, so I’ve booked it for 2013.” Experts at the meeting stressed that virtually every farmer’s individual circumstances will be different, depending on whether they own or rent land and property, which family members work on the farm, and who will inherit what. There are many ways to plan and mitigate the burden of inheritance tax. Managed by Lantra on behalf of Yorkshire Forward LandSkills Yorkshire and Humber Programme Manager, Julie Hamilton, added: “Succession planning is an area often overlooked by many farmers because of a lack of understanding on what needs to be done. By avoiding the issue there could be financial implications for the family, business, tenants and owners and LandSkills is funding such workshops to make it easier for farmers to plan for the future and ultimately save money.” Ian’s circumstances are unusual in that the farm came to him through his mother, rather than the traditional male line. His father was in fact a crop-spraying chemist… Today he is sole owner of 600 acres and rents another 2000, some 1400 acres of which are moorland. The livestock comprises 1400 breeding ewes and 130 cows in calf with single sucklers, plus another 800 cattle bought in for fattening each year. The business also incorporates rental properties and the airstrip and storage hangers. Ian has been farming for 35 years but says he’s always keen to learn something new, which is why he attended the succession planning event. “There are all sorts of laws and rules and it woke me up to what needed doing. That meeting has done me a lot of good. You’re there to listen, learn and then act. You can secure the inheritance and stop the Treasury getting their hands on too much if things aren’t done properly. I admit if I hadn’t gone to the meeting, things might not have got done - you have to make time to do this and you don’t have to do a lot to save a lot. I’ve tied up all the loose ends.” For more information about LandSkills Yorkshire and Humber visit www.lantra.co.uk/LandSkills or phone 0845 278 8800. – ENDS – Issued by: Lantra Press Office. For more information, please contact: Vicky Brewin, Marketing and Communications Co-ordinator telephone 02476 858 417 or email: England.media@lantra.co.uk NOTES TO EDITOR: The Rural Development Programme is jointly funded by the EU, through the European Agricultural Fund for Rural Development, and the Government. In England, the programme will also make use of Voluntary Modulation. The RDPE 2007-2013 has a budget of £3.9 billion. This is more than double the budget available for the previous programme which ran from 2000-2006. £3.3 billion of the total budget will be allocated to agri-environment and other land management schemes. This funding will help farmers to manage the land more sustainably and deliver important outcomes on biodiversity, landscape and access, water quality and climate change. Some £600 million will be made available to make agriculture and forestry more competitive and sustainable and to enhance opportunies in rural areas. LandSkills is managed by Lantra Sector Skills Council on behalf of 6 Regional Development Agencies as part of the Rural Development Programme for England (RDPE), which is funded by Defra and the European Agricultural Fund for Rural Development. About Lantra Lantra, the Sector Skills Council for the environmental and land-based sector, is licensed by the UK government to drive forward the new skills, training and business development agenda for the sector. Lantra represents 17 industries and 1.5 million workers and volunteers in agricultural crops, agricultural livestock, animal care, animal technology, aquaculture, environmental conservation, equine, farriery, fencing, fisheries management, floristry, game and wildlife management, land-based engineering, landscape, production horticulture, trees and timber and veterinary nursing. For more information see www.lantra.co.uk
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