Experienced legal professionals at Latimer Hinks can provide the legal help and assistance the agricultural sector needs in relation to succession planning.
Anne Elliott is an expert in the area which affects all family businesses.
Identifying a successor(s) in a way which ensures the best outcome for the business and usually for the family is a major factor in the process. The priority is to establish objectives. Only then can a plan be formulated.
"Have the successors the right skillsets and abilities? is a question which needs to be posed.
Anne advises: "Having established the principle of how you want to move forward, enlist expert advisers to make sure that plans are viable, watertight, tax efficient and minimise the potential for challenge by, or conflict among, family members.
Another key element of succession planning relates to Inheritance Tax (IHT) planning, particularly with reference to the implications of any diversification and its impact upon valuable IHT reliefs.
Many farmers have boosted their income by diversifying their commercial activities, for example by conversion of under-used or redundant farm buildings (to provide residential or commercial and business lets) and wind farm projects, farm shops and livery and related equine activities.
Problems in securing Agricultural Property Relief (APR) for IHT purposes where land and buildings traditionally used for agricultural purposes have been adapted for alternative uses.
She added: "There are important rules regarding not only use but length of ownership of property. Farmers and land owners who have changed, or are considering changing, land and building use should be aware that they can lose APR. If they do then to mitigate IHT they must try and ensure that they qualify for an alternative IHT relief, Business Property Relief (BPR.)
"Diversification can be commercially essential for farmers, but there are pitfalls in retaining and ensuring eligibility for IHT reliefs. With the right advice and careful planning the potential loss of these immensely valuable reliefs can be avoided.
For more information about Latimer Hinks services, visit www.latimerhinks.co.uk, or call 01325 341500.