Farmer Focus: Formalised partnership helps avoid tax burden

Winter for many of us is a time for taking stock of the business and preparing for the spring.

As one of the greatest procrastinators of the modern era, this is usually a time not to bother but hunker myself away from the weather in the office of the second job.

However, this year has been different.

See also: How farming brothers are preparing for business succession

About the author

Anthony Becvar

Anthony Becvar is a third-generation farmer of an 80ha mixed farm in East Sussex on heavy Weald Clay. Crops include spring beans, winter wheat and spring barley, alongside diversification projects which include two breweries and an agricultural mechanic.

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With Rachel from accounts throwing us all under the bus, we have had to take stock of the business and make changes that we never thought were necessary.

This means we have been splitting land ownership and formalising a farming partnership.

This has taken a lot of time recently and a newly acquired (yet vastly limited) understanding of tax law.

At no point in my agricultural degree (or at least the lectures I made it to) did we learn about succession management or the tax issues concerning commercial lets.

Is this something that happens now?

It is now apparent that my working life on the farm would have continued without much of a visible end, or a planned one at least.

I hadn’t given much thought to retirement, succession or planning for either.

Our eldest daughter has to complete work experience this year and like many kids her age, doesn’t have much of an idea what she wants to do in the future.

She does, however, love animals and so is helping a neighbouring farmer friend with lambing this spring.

I wonder if this will firm up a desire to work with farm animals.

I wonder if it will put her off sheep for life as it did for me.

I’ve managed the farm over the past 25 years to fit in with me having a full-time job off site.

This doesn’t give much room for a new generation to resurrect it as a minimally diversified mixed farm without greatly reducing current income and vastly increasing investment in infrastructure.

Speaking of investment in infrastructure, and in a reversal of my annual procrastination, I finally fixed a gutter on one of the let buildings.

Naturally I did this using baler twine and a few other bits I found lying around.

Purely in an effort not to increase a future tax burden of course.