Have you a Will made? If not, why not?

By Keith Fahy Teagasc B & T Drystock Advisor

“Do not complain about growing old. It is a privilege denied to many”. This was a quote made famous by Samuel Langhorne Clemens best known by his pen name Mark Twain. Twain was famous for his writing, publishing and lecturing along with many more high profile accolades but most people know him for his famous quotes. While I am not going to spend this article writing about Twain and his many life achievements, I do want readers to understand that farmers get old too. I deal with farmers every day and it is interesting to experience the array of different mind sets farmers have in relation to making wills and transferring the family farm.

If we look at the CSO figures from 1991 to 2020, we can see that there is a negative trend in terms of the ageing farmer profile. In 2020, almost one third of all farm holders were aged 65 or over compared to just one fifth in 1991. This is a staggering statistic especially when we take into account that in 1991, 33.1% of farm holders were under the age of 45, whereas in 2020 this age group represented just 20.8% of all farm holders. When looking at the proportion of farm holders under 35, this has been falling consistently since 1991 but there was a slight increase in the proportion in this youngest age category between 2010 and 2020 from 6.2% to 6.9%. (CSO Data). So the question must be asked, why aren’t farmers transferring the farm to their children/successor sooner? Is it an old Irish traditional issue? Do farmers not want to let go? Do the farmers need the income from the farm to support their retirement pension? Do they not trust the next generation? Do the next generation have no interest? From dealing with a large number of farm families, I see all aspects from some farmers passing on the farm to their children once they have become adults, to the other end of the scale where I spoke with a farmer last year that inherited the farm at 73 years of age, surely in these situations one must consider skipping a generation, or even two?

Succession Planning:

Ideally all of the family will sit down and talk with their spouses, children and potential successors. It is vital to talk about what is going to happen and explain who will get what.  In an ideal scenario each member of the family will know who is getting what. This may reduce any potential future conflict that may arise after a loved ones passing.  Joint herd numbers and partnerships are also another way of gradually transferring the farm whilst the owners still remain involved.

Tax:

When the assets have been decided upon, the next step is for all parties to try and reduce the tax liability for the family farm. A good accountant that is experienced in dealing with farm transfers is advisable. All parties need to look at all the ways where savings can be made. This can be through completing the green cert to reduce the stamp duty, allow for stock relief etc.

Education:

Young trained farmers can also avail of top ups on BISS, Higher TAMS grants of 60% versus 40%, Qualify for Stock relief and stamp duty relief as previously mentioned whilst learning the basics, principles and farming systems along with many more important modules covered including but not limited to Health and Safety, Animal Husbandry, Machinery Etc.

Solicitor:

Farmers should meet their solicitor and draw up a will which is a legally binding document and make sure that it is witnessed and that all assets are covered. Advice from solicitors may assist in the formation of the will also.

Mediators:

Mediators may also be of benefit whereby any issue arises between family members. Mediators can be an excellent way to come to a decision or agreement where certain situations can become impractical for the family to sort amongst themselves.

Teagasc Transferring the Family Farm Clinics:

Teagasc run a series of clinics around the country and all aspects of succession and inheritance is covered with qualified speakers covering areas of land transfer, tax, legal issues, farm business, collaborative farming education and more. The booking page is now live for the annual “Transferring the family farm” series of clinics in October this year. See link: https://www.teagasc.ie/rural-economy/farm-management/succession--inheritance/transferring-the-family-farm/

See list of above areas where the clinics will occur along with dates and eircodes. While it may seem like a few months away, similar to succession planning it must be something that is planned for well in advance.