Business and Succession Planning for the Rural Family – 5 program on demand webinar series

The Long and Winding Road: Succession Planning for Intergenerational Farming Families

Change and forward planning can be difficult concepts when a farming family has been undertaking business in the same way for many years with no eye on the future. One of the roles of a trusted adviser is to assist such families, and this session will provide skills and advice to manage this process and achieve an appropriate outcome for the family, including:

• Tips on facilitating family succession planning
• Who is your client? Should each family unit have their own adviser?
• Using a third-party facilitator to work with the family
• Essential elements of farming succession planning
• What should be in a succession plan?
• Key considerations for vulnerable and aging family members
• Tips for building in flexibility and dispute management
• Exit strategies when all else fails

Heading Them off at the Pass: Minimising Legal Risks in Estate Planning for Rural Families

The last thing elderly parents want is for the next generation to be squabbling over the estate after they have gone. The likelihood of this largely depends on what consideration the parents have given to what happens to the farm after death. This session will provide a guide to anticipating estate litigation through effective estate planning for families on the land, including:

• Strategies for approaching and advising farming families on estate planning - is it ever too late?
• Consideration of contributions by, compensation for and special needs of adult children
• How to anticipate and manage competing claims and generational hopes and dreams
• Is a testamentary trust a solution or a problem?
• What to do about the estranged child?
• Pre-empting claims on the basis of promises made: Rodda v Ian Rodda Pty Ltd [2015] SASC 95
• Lessons from family provision claims and other disputes
• When is a deed of family arrangement the answer?

Legal and Financial Considerations in Intergenerational Farming Business Structures

The decision to re-structure a family farming business requires a full consideration of risks and consequences of change. This session will examine the most common models for intergenerational farming businesses and particular matters that need to be taken into account, including:

• Partnerships:
  • Advantages and disadvantages
  • Management and ownership of assets and operations
  • Financial and tax considerations
  • Key deed clauses
  • Flexibility and exit strategies
  • Case studies on partnerships
• Family Trusts:
  • Why set up a trust? Benefits and limitations
  • Financial and tax considerations
  • Control now and into the future
  • Asset transfer and management including tax considerations
  • Adding new beneficiaries
  • Dispute resolution mechanisms
  • Case studies on trusts
• Companies
• Using entities in combination
• Case studies on using entities in combination
• Share farming arrangements:
  • Asset ownership and obligations
  • Cost and profit arrangements
  • What should be in the agreement?

When Worlds Collide: Farming Family Business and the Family Court 

Marriage breakdowns in farming families bring with them additional challenges, including considerations of the wider domestic and economic relationships in the extended family. This session will provide advice on strategies to protect the family farming business from property claims in the Family Court, including:

• Is farming land treated differently for the purposes of a property settlement?
• What factors do courts look at to determine assets, contributions and entitlements in farming family marital breakdowns?
• Ex-spouse claims on the basis of “common endeavour” and how to pre-empt them: Nolan v Nolan [2014] QSC 218
• The role of binding financial agreements to deal with claims for a share of the family farm
• Structuring loans, arrangements and gifts to adult children for asset and financial protection
• Business structuring and property arrangements for quarantining assets in the event of a relationship breakdown
• Lessons from recent cases.

Tax Tips and Traps in Rural Property Transactions

Keeping abreast of obligations concerning federal taxes on rural property transactions can be challenging. This session provides an update to practitioners on the latest changes and potential developments in this complex area, including:

• When is land eligible for the small business CGT concessions?
  • What is included in the maximum net asset value $6m test?
  • The passively held asset, affiliates and connected entity test
  • When disposal of a passively held CGT asset happens after business ceases
• Which 2 hectares to choose for the main residence exemption (TD 1999/67)?
• Business of primary production or hobby farm (TR 97/11)?:
  • The income tax implications on a land sale
  • The GST implications on a land sale
• Transferring property to a family member:
  • GST considerations (including sec. 38-475 of the GST Act and the implications of getting it wrong)
  • CGT considerations
• Practical strategies for minimising tax obligations on land transfers:
  • How should transfers be structured?
  • Comparing tax treatment of land transfers inter vivos and on death
• When will subdividing and selling of farmland be considered an enterprise for GST purposes? (San Remo Heights v FC of T [2020] AATA 4023)
• Recent legislative changes:
  • GST withholding that can apply to potential residential land
  • Foreign resident capital gains withholding
• Case studies, including review of PBR 1051303645955