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Independent.ie

Monday 19 November 2018

Opinion: Farmers finally waking up to the realities of land succession

'One of the main reasons that farmers put off success is that they don't know how to go about it'
'One of the main reasons that farmers put off success is that they don't know how to go about it'
Ann Fitzgerald

Ann Fitzgerald

The Irish farmer's reluctance to pass on land runs very deep. That is changing - not before time.

It's becoming rarer, though still not unknown, when a farmer dies for it to be said: "I hear that Paddy or (less commonly) Mary got everything".

When you think about it, this indicates that there was a lack of outward evidence of a succession plan before the owner died (for example, the appearance of another name on the chequebook).

It could also well mean that nothing was going on behind the scenes either and the inheritance came as a surprise even to the recipient.

This was never a good way to pass land on.

The reasons why it happened include: the reluctance to face up to our own mortality, fear of losing control of the farm, the loss of status in the community and the loss of identity, e.g. "if I am not a farmer, what am I?"

But while "everything" meant the farm and its physical structures, it also often involved the inheritance of hassle, heartache and mess.

This could include, for example, the financing of substantial tax bills and interpersonal conflict with other family members.

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I attended the recent Teagasc event on farm transfer in Portlaoise, where the audience comprised a lot of women and a few obvious parent/child pairs - but no elderly people. The other thing I noticed was a sense of calmness.

So what does that all mean? I am no expert but…

In the case of the elderly, it could be that they all have their affairs in proper order… though it's also possible they have put them off for so long that it's not now going to happen.

In terms of the women, I would say this is because they are often the ones who push to have such stuff sorted.

As for the pairs, the transferor and transferee are working together on the transfer. This was good to see; it is as it should be.

The key to a smooth, working and desired transfer is communication.

The other salient point is that the view of inheriting a farm is changing. It is no longer seen as the keys to the kingdom of unbounded wealth (which it never was anyway) but simply an opportunity to make a living.

Indeed, in many instances, it is the off-farm income of a spouse that determines the level of education that children attain.

Many of those who grew up on farms, got educated and have secured a good job are now declining the opportunity to farm.

Like any job, if it's for you, farming is a good life, though not an easy one; but so many lives have been wasted because a farm was taken on through a sense of duty.

About 150 people attended the event and Teagasc's Fintan Phelan pointed out that they are already on the right road to making good decisions (hence the calmness?).

His advice is to "talk early," and "canvass lots of different opinions".

Every situation is unique and some situations can be tricky, but there may be solutions that people don't know about until they actively investigate them.

You make better decisions when you're better informed.

"Farmers face different problems every year but the one thing that faces every single farmer is passing on the farm," said Fintan. "The only way around it is to do nothing, (let whoever comes behind to sort it out) - and that is never ideal".

There are, for example, circumstances when it makes most sense not to transfer land until after someone dies, but you won't know that unless you look into it.

"You can plan for lifetime transfer but can't plan for those that occur in death."

Know what you want to do, find out what the implications are (in terms of tax and otherwise), then take it from there. Wise words!

Indo Farming

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