Ask the Legal Expert - Should I draft a Will to protect my family farm?
- AuthorGemma Tooze
“Our family farm has passed through several generations and I would like to protect it for future generations. Will a Will help me achieve this?”
For many farmers, their farm is their most treasured asset and it is important to seek legal advice on how best to protect it for future generations.
Having a correctly drafted Will can provide peace of mind in ensuring your farm passes to those who will carry on the business once you have passed away. Provisions such as monetary gifts can also be made for loved ones who are not involved in the running of the family farm. A correctly drafted Will is vital when attempting to prevent future disputes from arising amongst possible beneficiaries.
Furthermore, many farmers are unaware that once they have passed away, their estate could benefit from Agricultural Property Relief. Assets which qualify for the relief can be given either a 100% or 50% relief from Inheritance Tax. However, to claim this relief, strict requirements must be met such as the land and buildings being used for the intensive rearing of livestock or the production of arable produce. It is important that professional advice is sought to ensure you do not fall into any traps and lose the relief, as this relief is vital in ensuring parts of farms do not need to be sold off in order to settle an IHT liability.
Inheritance Tax relief can also be claimed if you have woodland on your farm.
If an estate can qualify for Agricultural Property Relief, it is possible that Business Property Relief may also be available. However, if this is the case, Agricultural Property Relief will be given priority with Business Property Relief applying to any non-agricultural business elements of the estate.
The question posed is based on a hypothetical situation.