The Autumn 2024 budget fallout continues and farmers, in particular, remain resolutely unhappy with the Government’s plan to significantly curtail the previously generous Inheritance Tax reliefs (Agricultural Property Relief – APR and Business Property Relief – BPR).
Farmers have been arranging protests around the country to try and persuade the Government to reverse their proposals. As time goes on it seems less likely that there will be any reversal, whilst it becomes clear that the number of farmers affected is massively above Government estimates.
So, what can farmers and landowners do in this situation?
Firstly, make sure that you have a good understanding of your land and property ownership. We know that within farming families, land is often registered in the names of different family members, perhaps due to availability of cash at the time of purchase, or simply a desire to spread the ownership. Get the Land Registry Title documents to make sure – never assume an ownership.
Secondly, make sure that wills, partnership agreements and LPAs (Lasting Powers of Attorney) are reviewed and up to date. If you don’t have these, then now is a good time to get them.
Thirdly, decide what general aims the business/family has. Is someone due to retire? Does somebody want to leave? Is there sufficient profit for the business to be sustainable? Crucially, what may the IHT position be in the event of a death? It is vital that all farming businesses address these questions. Get the family round the table and speak openly. Now is not the time to be shy.
At Oakwood we can help farmers (and other business owners for that matter) assess their property assets and start the ball rolling on a plan. We will look at the value of assets – there may be issues that you haven’t thought of such as access, restrictive covenants, development potential. We work with leading farm advisers, solicitors and accountants to assist farmers in their planning and there has never been a more important time to take professional advice. Collectively we will address tax issues, documentation, and potential liabilities.
The downside of not getting expert advice is potentially very costly and yet we see families on a regular basis who are a long way off being prepared for business succession or sustainability. Assuming that the Government will bow to farmer pressure is naïve (and getting further away). Whilst we know that you cannot prepare for every eventuality in life, there is so much that can be considered and taking the ostrich approach will not work.
We continue to offer a no obligation consultation by telephone or zoom – and in some cases we’d be pleased to make an on-site farm visit.
