Succession on the farm

The rules moved. A lot of farms moved with them.

For years the answer was that agricultural property relief covered it and nobody needed to do the sum. Since the cap came in, the farms that were comfortably covered are the ones most likely to be caught — because they are asset-rich and have never held cash.

A worked example, rounded

Two hundred and forty acres, a farmhouse, a range of buildings and the machinery. Nothing unusual about it, which is the point.

Land, buildings and house£2,600,000

Covered at 100% relief£1,000,000

Remaining value£1,600,000

Relieved at 50%£800,000

Taxable£800,000

Tax at 40%£320,000

Three hundred and twenty thousand pounds, on a business that might clear thirty in a good year. The instalment option spreads it over ten years and on agricultural land it carries no interest, which turns it into roughly thirty-two thousand a year — still the whole profit.

What usually helps

Getting the farmhouse properly within the farm business rather than sitting beside it
A partnership agreement that says who owns what, written down and dated
Lifetime transfers made early enough to run their seven years
Knowing which fields are let, because letting changes how they are treated

What rarely does

Waiting to see whether the rules change back
Putting the land in a company without working out the tax on getting it in
A will written in 1998 that names a farm that has since been sold in part
Telling one child and not the others, which is how the expensive arguments start

£690 A planning day, usually two generations in the room

We are not solicitors and we do not draft the documents. What we produce is the number, the options and a short brief your solicitor can work from — which is generally the part that costs the most when it is done from scratch at their hourly rate.

Ring 01743 624422

What we do

SFI & grant windows Diversification maths Succession on the farm Kitchen-table sessions

Small print

Privacy Terms Cookies

Office

Address94 North St
Shrewsbury SY1 2JE

Phone01743 624422

Email[email protected]

Before you ring

The first call costs nothing and takes about fifteen minutes. If the job is really one for your accountant or your land agent, we will say so and point you at the right door.