Experts advise on family issue
Assessing the farm's assets and family aspirations are the catalyst to planning successful farming succession, says Balfours, Farm Business Adviser, Trevor Sheard
This was the message from Balfours, Farm Business Adviser, Trevor Sheard, who was speaking to some 40 farmers at Bridgnorth at the first of a series of Succession pie and pints evenings.
Mr Sheard explained: "Firstly you need to get your farm business adviser involved to assess the farm's assets and family's aspirations.
"Planning your family farm succession should evolve through a five-way conversation, between the two generations, your land agent, solicitor and accountant."
Part of that equation will be to consider secure and insecure incomes - secure incomes, include Stewardship schemes and diversification.
"The value of ELS and HLS are not guaranteed, but we know they will be there until 2012. Non-secure income are products - beef, sheep and crops, which are subject to market fluctuations.
"The ratio of hired and family labour and where the two generations are to live are major considerations in the succession process," he added.
Balfour's partner, Rory Galliers, warned that farmhouses, let farm cottages and commercial properties could be problem areas for inheritance tax if not handled correctly.
Where funds have to be raised to ease the succession process two avenues were highlighted.
Harriet MacKenzie-Williams, of Dixon Sutcliffe told the audience that today's pensions were much more adventurous.
"There are lots of things you can put into a pension, without selling them. You can use land, woodland or commercial buildings, providing they don't have borrowing on them, to secure your pension.
Alternatively you could increase the value of your SFP by 40 per cent overnight, if this can be invested in a pension."
AMC regional agricultural manager, Gary Edwards, urged farmers to approach the succession issue top down.
"Family considerations are foremost, followed by the viability of the farm business; tax issues and banking should then be worked to favour those decisions. Avoid finance where the business is not getting tax relief."
Picture: From left: Harriet MacKenzie-Williams, Dixon Sutcliffe; Trevor Sheard Balfours farm business adviser; Julia Brereton SASTAK; Rory Galliers, partner Balfours and Gary Edwards, AMC.
