A simple guide to farm succession and transferring the farm
A Farm Succession and Transfer guide has been produced by Teagasc to help farmers with a step-by-step approach to transferring their farm.
Farm succession is the gradual transfer of the management of the farm and inheritance is the transfer of the ownership and Tomas Russell, a PhD student with Teagasc recently presented the key elements of the guide.
The guidebook, he says, has a workbook with self-complete exercise, to get the farmer thinking about the options available to them. Every farming situation is different and Russell says you want to transfer the farm from generation one to two and built into that is succession.
Succession is a longer drawn out process than inheritance.
He highlighted the importance of making a will, as it also allows farmers identify what stage of succession they are at and what options are available if the farmer does not have a successor, such as long-term leasing.
Russell also said every farm must look at the profile of their farm, the efficiencies of the farm and if the farm can support one or two incomes. An advisor, he said, may be able to determine if perhaps a new farmer could increase productivity on the farm.
A profile, he said, of the family helps the farmer identity all the family members and the needs and requirements of each.
One key area, he said, that is crucial is communication. “Communication is one of the biggest issues when it comes to succession and inheritance. You must communicate for effective planning.”
Discussions around succession and inheritance should not be a one-off. The Teagasc book, he says, gives some guidelines around timing and when to do this, such as when children are starting secondary school, college and during their early and mid careers.
What happens if you can’t agree?
Mediation is a process whereby an outsider is brought in to help work through problems. Farrell says that mediation can help if you can’t get to a decision and will advise what you can do to work through it.
The ideal succession scenario, he said is a partnership and the Teagasc looks at the management role a young farmer has on the farm and how that can be developed into a more formal structure.
“It helps increase the younger farmer’s role in the farm.”
The Teagasc book also looks at the actual farm transfer as it can be confusing – who to go to first? what is the exact role of the accountant, solicitor, advisors, family members etc? and, in order of priority, who you should go to first?
The Farm Succession and Transfer Guide is available to buy from Teagasc here.