Succession...comes to Yorkshire

Like me, you might be an avid follower of the epic Sky Atlantic box set ‘Succession’ (no spoilers please – I’m still wading through season 2). For those who haven’t seen the show, the drama features a family who own a multi-billion media empire and their struggles to reconcile which of the next generation will take over the family business.

The four children/contenders have differing feelings towards the business ranging from apathy to avarice and at the heart of the story is their father (the patriarchal founder of the empire) who is trying to work out how to keep the pieces of the family and business puzzle together both during his lifetime and beyond.

So what has a malign family of narcissists and a US media conglomerate got to do with rural Yorkshire and, in particular, family farming businesses? Thankfully, very little I hope, other than sharing familiar dilemmas of how to preserve a family business that has been diligently stewarded by past generations. A seemingly impossible balance of treating future generations fairly whilst being respectful to their own, sometimes juxtaposed, priorities and life goals.

As lawyers, we frequently advise clients on these situations as the issues often emerge at the time of making a Will. The trick is, as ever, to plan early; it goes without saying that family discussions about the eventuality of your retirement and death are a proactive step. Here are a few jottings of some frequent themes that we see that might be helpful to you when considering your succession planning:

Let the dust settle – bad decisions can be made in haste so the use of a trust in a Will can help preserve the farm and business under the control of trustees for a period of a couple of years or so until the family have made firm decisions about how they want to go forward. Only then are the assets distributed once the family have decided who wants to continue the farm, who wants to move on, etc.

Your pension – farmers are allowed to retire too! You may have an eye on an income stream that you want to keep for your retirement income after you have handed over the bulk of the land and farm to the next generation. Plan early to build in time for the legal process and, potentially, tax planning of moving assets away from the business into your own name.

Farmhouse – Farmhouses only attract agricultural property relief if they are the centre of farming operations, so a retired farmer, or farmer’s widow/widower will struggle to qualify for that inheritance tax relief if they continue to live in the farmhouse after retirement. With the value of farms these days, you will have an eye on inheritance tax planning which means planning where you will live in semi-retirement or retirement.

Partnerships – unfortunately sudden deaths happen. As well preparing a Will, there may be other legal areas to consider such as a partnership agreement. Colleagues have written columns in this paper about the merits of a written partnership agreement – without an agreement in place, the death of a partner automatically ends the partnership which can have awkward financial and commercial consequences.

I would be delighted to speak to you about your succession (though please do not tell me the ending of the TV show!).