The farm... a family divide?

Farming is, overwhelming, a family business, a vocation and a way of life, more so than many other forms of employment or business structure.

It is unsurprising, therefore, that farming families are strongly motivated to pass on the family farm to future generations.  Taxation can represent formidable hurdles despite reliefs being available to reduce the overall burden.  However, perhaps of greater concern are immense family difficulties that arise where farms are asset rich and cash poor, making distribution and equality between those beneficiaries involved in the family business and those that are not, very difficult indeed. 

Several cases in the High Court over the last few years serve to illustrate a rise in the number of farm ownership and inheritance disputes, with the result that farms have been divided and separated, as well as families themselves.

It is no wonder, therefore, that we are often asked how this can be avoided.  In short, there is no easy answer but it is important, however difficult, to address early on and openly.  The succession of the farming business is for the benefit of future generations and it is prudent to know their aspirations so that steps can be put in place and, if necessary, the business re-designed to ensure continuity and family harmony.  

Thereafter, make sure that an up to date will is in place, possibly with trust provisions incorporated.  Trusts offer some degree of control whilst providing flexibility as family dynamics and circumstances change, which is inevitable in all walks of life.  Trustees are able to make decisions at the date the will comes into effect whilst taking into account family circumstances, continuation of the farming business and potential taxation consequences, but most importantly ensuring your wishes are followed.

Our advice, therefore, is that once you and your family have decided what you wish the future to hold, you consult with all your advisers, including land agents, accountants and lawyers, to enable them to work with you.  All these professionals have invaluable knowledge and expertise that will allow your hopes and dreams for the future to be achieved and not later destroyed in the courts, together with your family!