25th August 2014
Teagasc are hosting a series of clinics around the country titled “Transferring the Family Farm”. These events, which will commence on the 9th September at Errigal Country House Hotel, Cootehill, Co. Cavan, are open to all farm families to attend.
James McDonnell, financial specialist, Teagasc said: “Inheritance and succession, is an on-going issue for Irish farm families and must be dealt with in a timely fashion. At these clinics you will gain an insight into, not only the legal, social welfare, and tax implications, but also the best way to go about having the conversation in the family setting.”
Planning the transfer of the family farm to the next generation can be a difficult task for any parent. There are good tax incentives to promote early farm transfer, but this is a personal decision for every land owner. Completing this task, while looking after all of your dependants fairly and your own future income in the most tax efficient way, while fulfilling the requirements of the law, is not easy. Many people put off the event for as long as possible, but if the process started promptly and with careful planning some of the pitfalls may be avoided.
At each of the 11 clinics, a Teagasc Specialist will make a short address, covering all aspects that need to be considered when writing a succession plan. The clinic will then be open to the farm families present to go and have “one to one” private conversations with the professionals set up in booths around the venue.
Professionals in attendance will include;
• Accountants/Tax advisers
• Succession mediators
• Social welfare advisers
• Citizens information
• Teagasc Education officers / Collaborative farming / financial specialists
Family involvement in planning for succession is essential. A key aim must be to have an open conversation with the people involved so that misunderstandings can be avoided. Some issues you can address with the relevant professionals could include:
• Writing a will / forming trusts
• Starting the conversation within the family
• Income security after retirement and pensions
• Fair deal scheme and its pitfalls
• Options to cater for other siblings
• Forming a partnership with your children
There are also a number of Tax issues to be considered. On life time transfer of farm assets, Capital Acquisitions Tax (CGT), Capital Gains Tax (CGT) and Stamp Duty are the taxes for which a return must be filed. Reliefs may be claimed from each of these taxes. With the drop in property values over the past few years the threshold of each relief has also dropped so care must be taken in planning the transfer to reduce any tax due.
Transferring the family farm with good professional advice will help make the task less daunting. It is important to make preparations early so that potential problems can be assessed and avoided before they arise. This will give peace of mind to the parent and give the successor the best possible chance of keeping the farm business together for future generations. The majority of farm families do not plan adequately for succession, so all land owners and potential successors are encouraged to be informed of the issues by attending one of these events.
Seminars will take place from 9th September to 14th of October at various locations around the country. Pre booking is essential.
• Book online at http://www.teagasc.ie/events
• Contact your local Teagasc Office