Farmers warned to plan ahead to prevent their families facing huge tax bills after their death
Farmers across the UK could be leaving their children with ’crippling’ tax bills after they die.
Helen Gough, associate at MFG solicitors warned complex inheritance rules for agricultural land and buildings mean the Inland Revenue could take more than necessary if farmers do not plan ahead.
Ms Gough urged farmers to consider their succession planning and whether their current business arrangements are in the long-term interests of their family as well as tax efficient.
“It is no exaggeration to say hundreds of thousands of pounds can be saved if planning is done early enough, and there is no price tag that can be attached to the peace of mind that such planning can bring,” she said.
“Without that careful tax and succession planning, there is a very real risk that those inheriting farms and agricultural property will not only be left with a crippling tax bill but they may also have to face a dispute over who is entitled to what.”
Ms Gough said farmers needed to work with their children and understand what they want for the future of the business.
She warned failing to plan ahead could have wider consequences than just tax bills.
“If things go wrong, then as well as the tax bill the farm may have to be split up and sold off, while families are broken apart by dispute and legal costs,” she added.
“Effective planning is not hugely expensive and it ensures that everyone knows where they stand,” she said.