RESOURCES & GUIDES
Australian Farming Families: Succession and Inheritance
(Chapman Eastman and Charles Sturt University)
"This report is intended to examine the current and changing dynamics of succession planning in Australian farming families and the potential impact these changes will have on regional communities and the broader economy. Our survey enabled a close analysis of generational change regarding preferences and attitudes towards succession planning.
Results from the study will be used to inform agri-business owners and their children about the succession process and provide recommendations to the agriculture sector to support the handover of farm ownership."
"This booklet is a sound, factual guide that will provide an important starting point for many families. The inclusion of various professionals’ perspectives provides some wonderful ideas on the succession planning process, with each providing a slightly different take on the subject."
Face the Future with Confidence
Farming Ahead has a section dedicated to succession planning, with a number of informative articles and links to workshops.
"Succession planning is not a one off event. It is a process that may take ten to fifteen years. In fact, the longer the transition period, the easier it is to establish a sound retirement plan for the current owners and a sound business plan for the future owners. Transition payments to purchase the business can be made gradually thereby reducing the debt burden and easing the pressure on the future owners."
"A transition to retirement can be a challenging time for many farmers. The "R" word itself can conjure up an image of leaving the very thing they love, identify with, and is a key purpose in their working life. Succession, and in turn retirement, does not have to be a single event."
"The project sought to examine and compare the transfer of intangible assets of the farm business, such as managerial skills and specific farm knowledge between generations on the family farm, between various cultures."
"Traditional legal structures can be used by farmers as a legitimate means of protecting values pertaining to property, family and inheritance. However, the study found that younger farmers favoured newer forms of business structure."
Succession Planning Services
"Raising the topic of succession planning is not easy. There are critical times in the life of a business, and within the family, when succession issues are triggered and need to be discussed openly. Starting the process before a trigger point is best.
Planning for Succession
"Business success and financial planning are prerequisites to effective estate planning. It is stating the obvious that the ability to accumulate off-farm investments while maintaining a healthy farm enterprise, dramatically improves the chances."
"Succession provides a great opportunity for planning as to the future structuring of the farm business entity. The range of assets held in most businesses, give good opportunities for a range of holding options."
"Part of the succession planning process should be opening up lines of communication with family members. It can be tough having succession conversations, therefore a family may bring in an independent facilitator to ensure that the conversations stay on track and are not derailed by personal issues."
"The tax consequences of transferring assets can be substantial with the potential for stamp duty, income tax and capital gains tax to significantly erode capital available to the continuing farm business and / or the retiring farmer. It is therefore important to involve professionals early in order to develop a tax efficient structure, for example by accessing the small business capital gains tax concessions."
Farm Transitions Toolkit
(Land Stewardship Project)
"Whatever the case, this Farm Transitions Toolkit offers information, advice, and help to plan those changes. It’s a complex project that takes effort and communication involving family members and others, but planning for the farm transition just might be the most important thing you can do for your land. What’s it all about and how can this Toolkit help?
(Rural Financial Counselling Service)
The succession plan evaluates business and personal circumstances in light of current and possible future options, so as to develop a preferred course of action from a range of alternatives, while the business owners are still in a position of control."
ProAgtive have some educational ProAgTools on the way to help businesses with the succession planning process. Watch their website for updates.
"The process involves the transfer of managerial control, assets, ownership and an occupation. Successors must be selected and groomed. The timing of the transition and managing the entry and exit of family members is one part of the process.
The Farm Family and Their Family Farm
"The purpose of this GUIDE, is to provide farm families, information/ideas, that may assist them with a range of family, ownership and business issues experienced by a significant majority of farm families, including involving their family in their family business, ‘growing’ their farm business, farm succession and inheritance."
"This ‘buying back’ the family farm each generation, does nothing for Australian agriculture and the family member, who ‘buys back’ the family farm. Government rural policy has in the past been directed to increasing productivity of agricultural production. If farm viability is reduced by having to borrow to replace the money used to pay out siblings, then Government endeavours to increase productivity are undermined to some degree on family farms. The only winners with the use of the inheritance option, are the non-farming children."
Production Horticulture Succession Planning Toolbox
(Bundaberg Fruit & Vegetable Growers)
"Do consider using family meetings as a mechanism to open the lines of communication. While consultations with the whole family to try and achieve a consensus may seem daunting, inevitably decisions made will impact on all family members. Having everyone take ownership of the decisions and understanding how they were arrived at, will impact positively on the process you are embarking on.
There are also services and resources available to help with the process. Professionals with experience in facilitation and understand the range of issues involved, as well as people with expertise in the related management problems associated with the agricultural industry, taxation, accounting and the law, can provide specific succession planning advice and assistance."
Succession Planning Videos
(Wise Lord & Ferguson Chartered Accountants)
Farm Transition Planning Toolbox
Transition Planning: 12 Steps to Keep the Family Farming
(K-State Research and Extension)
"While many family-owned businesses have the long-term objective of “passing the business on to the next generation,” this is not an easy process. A great deal of planning, preparation, and communication is needed in order to accomplish the feat of moving the business from one generation to the next. The aspirations of both generations need to be addressed along with the financial feasibility of the operation supporting all involved.
Planning The Future of Your Farm: A Workbook Supporting Farm Transfer Decisions.
(Virginia Cooperative Extension)
"But one question stands out everywhere, persistent and perplexing: Who will farm the land? This workbook has evolved to help address this question for landowners fortunate to be closing in on an answer. It is my hope that any educational efforts this workbook supports will also seek to develop opportunities for those landowners who haven’t yet met someone to farm their land.
Farm Transition . . . . A Three Legged Stool
(University of Nebraska Lincoln)
- Estate planning, which involves transition of the business’ assets.
- Retirement planning, which involves transition of the business’ labor and management.
- Business Transition/Succession planning process, which involves a comprehensive long-term business plan and an in depth outline of the timing regarding the transition of each part of the farming business.
Developing a Family Charter = A Template for Farm Transition Planning
(Ag Transition Partners)
"The purpose of this family charter document is to clearly define individual roles, responsibilities and operating rules in writing transition and succession plans for the land and farming business. It establishes procedures for how the family communicates and makes decisions on the transition process.