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[News] Farmers
- Thread starter Harry Wilson's tackle
- Start date
- Apr 5, 2014
- 26,390
This was my thought. Sitting on land worth £5m that has been an ongoing farm for generations, and still intends to be, then slapped with a £1m inheritance tax bill. I can see it from their perspective too. If they sell, fine. But there should be different rules for ongoing concerns.
Could you explain why, unlike everyone else, they should be able to pass on millions without paying inheritance tax?
Clearly Harry you don't have any farmers in your family. I do and I can assure you it's not an easy existence - they get a pittance in 'profit' and their pay is far less than some townie medical lecturer with a gold plated pension
Official Old Man
Uckfield Seagull
I'm trying to keep up with this.
From what I understand, a farm owned by a couple will bring in an anual profit of £50K to £100K, for which they work hard.
But the value of the land will be around £5million, thus when they die and the kids take over, the kids have to pay 20% of the value. Let's say £1million tax due.
Now they can pay that over 10 years thus £100,000 a year. But that would be their entire profit gone.
Think that's how it is.
But, like anything, there are ways around this. Just needs a good accountant.
From what I understand, a farm owned by a couple will bring in an anual profit of £50K to £100K, for which they work hard.
But the value of the land will be around £5million, thus when they die and the kids take over, the kids have to pay 20% of the value. Let's say £1million tax due.
Now they can pay that over 10 years thus £100,000 a year. But that would be their entire profit gone.
Think that's how it is.
But, like anything, there are ways around this. Just needs a good accountant.
clapham_gull
Legacy Fan
- Aug 20, 2003
- 25,991
It does appear not as best thought out as it could have been, but this is this Government at the moment. For balance I'd like them to go after the supermarkets as well.
To the above point, I'm not sure how Clarkson is helping, especially when his previous honest comments on why he bought his farm are included in much of the coverage.
Harry or the government ? Or both ?
Bold Seagull
strong and stable with me, or...
What I still fail to get my head around is why a genuine family business isn't already structured for succession planning.
I seem to be hearing that farmers don't want to operate as modern businesses, however with my limited agricultural knowledge, the successful dynamic farms are the ones embracing technology, social media, and the business model of farming. Even without the IHT issue, it would seem farmers are missing out on potential tax benefits of being LLPs or Limited Companies that their own industry press and advice appear to be telling them.
All this IHT is seemingly avoided if genuine farming families that wish their decedents to continue their farming are properly bought into the ownership of the business earlier, and rightly so too if they are due to manage and run the farm going forward.
Peacehaven Wild Kids
Well-known member
One on the box this morning claimed it’ll cost him £800k
So without get the abacus out that values his farm at £4 mil.
I’m struggling to side with him.
So without get the abacus out that values his farm at £4 mil.
I’m struggling to side with him.
Somewhat depends if you want food on your table. A farm is a business and if farmers estates are forced to sell them to pay IHT then they will be either snapped up by big corporate farm businesses who care little about the environment & animal welfare and more about profits. Or the farms will get built on meaning having to import even more food and supermarket prices will go up.
Is it PotG?
Thrifty non-licker
In your opinion, how will the bill be paid?
Environmentalists blocking roads to protest against Climate Change and over-reliance on cars > arrests and prison.
Farmers blocking roads to protest against Inheritance Tax > fawning and forelock-tugging.
A two-tier police and justice system.
Farmers blocking roads to protest against Inheritance Tax > fawning and forelock-tugging.
A two-tier police and justice system.
- Aug 7, 2003
- 8,132
Using a trust for succession planning in a farming family can be a practical and effective way to ensure the farm’s continued success and the fair distribution of assets among heirs.
Super Steve Earle
Well-known member
You seem to be very angry and confrontational lately, often closer to fishing and baiting arguments than I recognise from your older posts. Just saying...
boik
Well-known member
Surely the simple solution is that the tax only becomes payable when the farm is sold? No benefit for tax avoiders if they can't sell the land. No penalty for farmers who genuinely want to hand the farm down.
- May 8, 2018
- 10,867
Also my understanding, the issue being if the working farm is handed down and continues to be a working farm then there isn’t the margin to repay over the allotted time.
Personally I think there should be an exemption if the farm land continues to be farmed as it’s needed , however if sold then a charge should be applied retrospectively
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Super Steve Earle
Well-known member
Well he can't spend the £4m can he?
It’s a tough sell to convince joe public that this levy isn’t a rich person’s problem, and a marginal one at that.
Much like VAT on private school fees.
In both cases, I find myself asking “why was this legal tax dodge ever in place, and how has it lasted so long?”.
Much like VAT on private school fees.
In both cases, I find myself asking “why was this legal tax dodge ever in place, and how has it lasted so long?”.
All things considered IHT on farms seems fair, and as far as I can tell it can be mitigated if they bring their businesses into the modern world.Clearly Harry you don't have any farmers in your family. I do and I can assure you it's not an easy existence - they get a pittance in 'profit' and their pay is far less than some townie medical lecturer with a gold plated pension