Farm inheritance - ILs should give farm to DH now

[farmerswife7]

I'll start by saying I know inheritance is never guaranteed not an entitlement etc and that we are very very lucky with what we do have now and what my DH will inherit.

I will also state I am not from a farming background and my mum rents so inheritance isn't something I have ever considered. I have always stayed out of what is said in DHs family as it didn't seem like my business.

We met with a solicitor recently to get our wills drawn up, mainly in order to have guardianship set out for DC.

We rent our house from ILs at a very reasonable rate. Both ILs are in their late 70s, they live in the main farm house, we live in a smaller older one.

DH works a lot on their farm. Thankfully FIL is still very fit/ active but understandably is slowing down. DH does not get a wage for this, but as I said we have lower rent.

I originally wanted to buy our own house. But this would have an impact on DH's inheritance tax, there is a farm relief scheme, we are in Ireland. So we didn't buy a house. DH also said there is no point as we will eventually inherit the whole farm and will need to live in the main farm house.

Now the solicitor brought it up when we went in and said about it being better for them to sign it over to DH now in case they end up in nursing homes a lot of the land could end up going in fees.

My DH went with my ILs about a year ago to see an accountant who advised that they sign it all over to DH now. They agreed. But then MIL when to a solicitor who advised against it so they didn't.

I'm a little worried about our financial future now. 1st and foremost I do not want ILs to end up in nursing homes. I genuinely do love them and want them around for as long as possible. DH says "they wouldn't go to one ever" but my uncle is currently in one suffering with Alzheimer's I don't think he thought he would go for one.

I mostly just wanted to vent my frustration.

AIBU to want my ILs to give the farm to DH now? They would still live in the main farm house and receive the farm income btw.

How much are the farm assets worth and how much financial assistance has been given to his siblings?
And are his siblings male or female?

I would guess about a million which I know sounds huge but only if we sold the land. It would generate a modest income.

1 brother 1 sister, both older. The brother by a lot, they really have zero interest in the farm. I don't know what they were given by their parents.

Unfortunately OP, just because the siblings have zero interest in farming, it doesn't mean that they'll have zero interest in the land and money when the parents die. I can see that you're eager to get it all wrapped up in case it needs to be sold for care or the siblings make a claim but it might not be that easy. I'm in Ireland too and my parents have quite a valuable house to leave. However, I'm not counting on it right now because it may need to be sold for the care bill, realistically. You can't count on the siblings not making a claim on the farm either.

Her day means she was allowed to live in house until she dies but she didn’t have any ownership - and therefore no assets to pass down to her own children.

I do think it is something you need to explore. Your husband is taking a significantly reduced salary now, and you aren’t accumulating any marital assets, because if the promise of this inheritance.

a good solicitor will talk you through the various scenarios that could happen and what you need to do to protect yourself. You are vulnerable in that you have no assets in your name and you are reliant on your husbands parents honouring this agreement.

in all likelihood it will be fine - but there are risks here and you should be protected.

A lot of people don’t realise what they need to do and when

by the sounds of it they do want to pass it to there son but have no idea how complicated it is

I'm not from a farming background but I grew up in a farming community and if you aren't used to the cultural norms it can feel positively feudal. Young Farmers' events are always full of second sons looking to meet a farming heiress.

I think it is time for you to start shoring up your financial security in the event that you don't inherit the farm. What do you do for a living? Do you both pay into pensions? Does DH have a paid job in addition to the farm work? Could you afford to buy and let out a property?

Unfortunately OP, just because the siblings have zero interest in farming, it doesn't mean that they'll have zero interest in the land and money when the parents die.

Exactly this.

I trained as a land agent so farm inheritance issues are something I’m very familiar with although in the UK. I think you all need to sit down with a specialist land agent or agricultural lawyer in succession planning, not an accountant. At least in the UK, most land agents run free introductory succession planning workshops which might be useful to attend together.

A quick google brings up a guide for planning succession that could be a good starting post- https://www.teagasc.ie/media/website/publications/2015/Farm-Succession-and-Inheritance-Guide.V1.pdf

I think there are two questions here

1. Should your in laws hand over the farm? This is a technical question, and it comes down to matters of law that I most of us know nothing about and are unqualified to give an opinion on
2. Are you being unreasonable for wanting some security about your financial future?

And the answer to (2) is emphatically NO. It isn't fair that you're expected just to deal with massive levels of precarity. But I think there are probably very, very many legal options in this between being given the entire farm and being given nothing at all. However, I don't think you're being stupid to want to find some ways to put your mind at ease now. A lot can go wrong in life, after all.

All four of you need to attend a specialist in this area to get all relevant information then make decisions. Ultimately, you cannot force them to do this, but seeing a specialist altogether as a family will help keep things transparent. I don't think it's fair of some posters to say it's none of your business as it quite literally is. A family farm that you will inherit is very much your business and you are absolutely invested in it's future. I hope all four of you can make the decisions in the best interests of all of you.

PS Just seen the update about siblings. Eeeeek! This sounds insane - are they really going to give everything to one child? That seems really unfair on the others, who surely have a right to a share of the house/land? They may well think that the current arrangement is temporary: you get a house rent free in exchange for labour, but this will end once parents are deceased.

I can't believe your husband isn't getting a wage at all. Even self-employed people (and I think co-running a family farm is a type of that) often pay themselves a salary. Does that mean all the rent money is coming from your pay packet?

"DH also said there is no point as we will eventually inherit the whole farm and will need to live in the main farm house."

There is never any guarantee of this.

"Now the solicitor brought it up when we went in and said about it being better for them to sign it over to DH now in case they end up in nursing homes a lot of the land could end up going in fees.

My DH went with my ILs about a year ago to see an accountant who advised that they sign it all over to DH now. They agreed. But then MIL when to a solicitor
who advised against it so they didn't."

Of course it is not in their legal best interests to sign away their assets - they may have no choice but to need high needs care later in life and their assets will need to be assessed to finance that care. This isn't a slight on you or any person but sometimes a medical based care home is required.

AIBU to want my ILs to give the farm to DH now? They would still live in the main farm house and receive the farm income btw.

No independent advice is going to lead to this - why would they be a risk of divorce? sale? having no choice in their care if the financial access is not available. Why on earth would they put themselves in a precarious position. If they are ill within 7 years the assets will be deemed to be theirs and it causes endless delays accessing fair access scheme.

I appreciate you are in a very tricky situation but really it is naivety on behalf of your DH.. Most farm education programmes cover how important it is to consider how to protect all parties?

There is a real possibility of him either having to buy out his siblings or sell up in the future - there is generational rows ongoing because of farming traditions in Ireland!

If they sign the house/farm over to DH now, what guarantee for them that DH won't throw them out?

Could the in laws sign the farm to you but not the houses? Or are they linked?

I have zero interest in farming, I have a lot of interest in £1mill.

Sorry OP, horrible and I can understand both sides.

It's incredibly common. I know a farmer in his 50s who still doesn't draw a salary from the family farm where he works more than full-time because it is supporting his elderly parents, from whom he will one day inherit. He and his wife are reliant on her salary. Fortunately their situation is more straightforward than most because he is an only child.

Deprivation of assets is a UK local council thing when it comes to assessing ability to pay care fees. The OP is in Ireland and so, assuming it’s not Northern Ireland, probably not relevant. Farms that are being farmed (in the UK) are outside the scope of IHT as they benefit from APR (agricultural property relief). But again, if the OP is in Ireland different rules will apply. Either way, it’s for the PIL to decide, not the potential inheritors!

People get very worked up about APR in the UK, but it’s the same as private trading businesses - the transfer of shares/ownership on death is not subject to IHT either as they qualify for BPR (business property relief).

Certainly in uk it would potentially be deprivation of assets but this is Ireland - does that apply there?

I also know people who do this, but they aren't also paying rent to live there - which has to come from somewhere. If OP left her husband then would they let him live there for free? Or would he have to move out.

IMO it's usually a sense of community ownership where you would no more charge your son (and probably heir) for living on the farm than you would charge your young children for living in their rooms.

Not from a farming background so it has really shocked me that people are expected to work for free for decades AND get charged rent!

This is a very bad situation for you OP, because basically your husband is working all hours (probably more than full time) for 200 euros a month discount off a house! This is not nearly a proper wage and also not something you can borrow against for mortgage purposes.

Plus the fact he is not an only and you don't know the contents of the will and it may go on care home fees, so it's far from clear he will recoup this money at all. This needs you and him to investigate this legally and it would be far better for you to buy a house separately as an investment if indeed his non-wage will support it.

It's not about intentions it's about what's legal and I would make provision separate if possible if his parents are not for being honest and upfront.

I should have pointed out we are in Ireland. I am originally from the UK and use the forum a lot, and as I understand tax is different between NI/ Scot/ Eng/ Wales so thought I could just see what people though.

And tax is different between the Republic of Ireland and the UK - two separate sovereign states. There are huge tax issues in the UK by not having business assets in the right ownership. These may not necessarily apply in the ROI, but the Irish tax code does draw from the UK one sometimes.

But I suspect the farm is in the ROI in which case that is where you need to take advice. The main issue will be establishing a plan that is compatible with the family and farm business interests. The two are intertwined as farming is a way of life. Certainly your DH needs to know his interests are protected with that of the farm. Discussions and an action plan are necessary - the solicitor and Irish farm adviser are necessary on this one.

But you are right to suggest putting something more formal in place. When that does not happen in the UK farming people can lose their homes and their livelihoods after many generations.

Reading the OP again I wonder if her husband does actually have an external job as well?

I'm from the farming community in Scotland, so no knowledge of situation in Ireland, but am guessing it is similarly complex financially, legally and emotionally.

You all need to sit down together with professionals (lawyers and accountants) who have good knowledge and experience of family farming in Ireland, and work out a succession plan.

Also - it is not always possible to keep elderly people at home if their health fails to the point that they need proper residential care, and if their finances are still entwined with the farm finances that can cause more problems.

Yes, she says he works as a contractor.