- Location
- Northumberland
If you want to farm it but the landowner wants/needs to be called a farmer, get a CFA drawn up. Everyone knows where they stand, then.
A farse, I know.
A farse, I know.
I agree, think trust will be the biggest thing. Would it work with the estate growing grass/crops etc if they are not wanting to be too involved with the day to day running ? would I be best to take on management and send them the bill?
Perhaps you underestimate your hand?You can’t have a better relationship when one party holds all the cards
if borrowing money to stock this place with machinery and livestock , i would want for to sure i had a sensible escape plan which did not end in bankruptcy , i have no doubt with some owners it could work, but equally no doubt many would have it weighted in their favour and not care to much for you.In my experience the actual land owner will want little to nothing to do with it. Much of the time they are retired people who can't actually manage it now but need to be farming for tax reasons.
You won't be getting a free lunch. The reality of it is they will be paying bills for your inputs and then charging you a bill in return which is weighted in their favour so as to give them a relatively fixed income of X per acre. They just obtain a stack of invoices in the process and generate a bill for you at the end of the year to let you buy the 'crop'.
You're misunderstanding how share farming worksif you are
if borrowing money to stock this place with machinery and livestock , i would want for to sure i had a sensible escape plan which did not end in bankruptcy , i have no doubt with some owners it could work, but equally no doubt many would have it weighted in their favour and not care to much for you.
no doubt your right , but the fact your the side who does not own the property does put you in the higher risk especially if you are financed up to the hilt to fund your side of the bargainYou're misunderstanding how share farming works
If you're in that deep, stop diggingno doubt your right , but the fact your the side who does not own the property does put you in the higher risk especially if you are financed up to the hilt to fund your side of the bargain
Share farming might include the landlord "renting" the new farmer the kit and/or already owning some or all of the stock and the share farmer buying the stock in "installments" - see above for how this might work with sheep initiatives I've known about.if you are
if borrowing money to stock this place with machinery and livestock , i would want for to sure i had a sensible escape plan which did not end in bankruptcy , i have no doubt with some owners it could work, but equally no doubt many would have it weighted in their favour and not care to much for you.
if you are
if borrowing money to stock this place with machinery and livestock , i would want for to sure i had a sensible escape plan which did not end in bankruptcy , i have no doubt with some owners it could work, but equally no doubt many would have it weighted in their favour and not care to much for you.
Yes im working my way through with them just now. As you can there are lots more people wanting an opportunity than actual opportunities. What I've found the issue so far is any potentials are not that keen once the opportunity has been offered. It is 100% about finding the right person which at the moment is appearing like a needle in a haystack but I am hopeful this is a way forward for the industry to get fresh blood in.The Scottish Land Matching Service (https://slms.scot/) purports to act as a 'marriage bureau' for this sort of thing. When I first heard about it, it was based in Dingwall, about 100 miles south of John O'Groats. It sounded interesting -- and it's a "free" service.
It now has an office in Edinburgh as well and appears to be operated by the NFUS. Has anyone heard about it? Or even used it? It has a register of people looking for land but doesn't seem to have one for the landowners, unless I missed it... I thought it might be interesting to see what pops up as I'm old, have land and all the machinery, but they've advised me to continue with what I'm doing and go for grass lets.
Once they do the sums and work out the capital they need and the rent demanded they just move to franceYes im working my way through with them just now. As you can there are lots more people wanting an opportunity than actual opportunities. What I've found the issue so far is any potentials are not that keen once the opportunity has been offered. It is 100% about finding the right person which at the moment is appearing like a needle in a haystack but I am hopeful this is a way forward for the industry to get fresh blood in.
I am still making my mind up abut the Scottish Land Matching Service (SLMS) as the initial web site stated that they were based in Dingwall which is hardly central for Scotland. I then discovered it appeared to be run by the National Farmers Union for Scotland (NFUS).Yes im working my way through with them just now. As you can there are lots more people wanting an opportunity than actual opportunities. What I've found the issue so far is any potentials are not that keen once the opportunity has been offered. It is 100% about finding the right person which at the moment is appearing like a needle in a haystack but I am hopeful this is a way forward for the industry to get fresh blood in.
I think a Share Farming Agreement needs an even better relationship between Landlord and Farmer than a tenancy.
You need to find out the landowner’s motive in not granting a new tenancy. The 1995 Act is much more flexible than the old 1986 Act.
Unfortunately capital taxation is a huge consideration for landed estates, and planning for the long term is an absolute necessity to preserve value. It is unfortunate that the regime can change in the future with unknown consequences.Two things come to mind:
1. There is no guarantee that the 100% IHT relief will persist for let land, particularly under a Labour Government. My personal view is that the TFA have done the sector no favours in pushing for FBTs to only have relief for tenancies > 10 years. It has just pushed landowners to not let at all, as per the OPs post.
2. Traditional Estates cannot get IHT relief on a lot of the non-farming assets. If they can demonstrate that the wider estate is predominantly a trading entity they can get Business Property Relief on the whole, hence wanting to be seen as actively farming.
Hopefully the sharer will have youth and fitness to offer. The landowner would be wise to have a good 'get out' clause, but that applies to both sides.Unfortunately capital taxation is a huge consideration for landed estates, and planning for the long term is an absolute necessity to preserve value. It is unfortunate that the regime can change in the future with unknown consequences.
However it is no good going to a man who has nought seeking a contribution.
Only as long as the drip of money lastsShare farming can work well ---i'm currently involved in 2 agreements
Key is ;
I am seeing more estates interested in this approach and i'm sure it will develop further over the next few years
- trust (you build it over time)
- adaptability ---nothing goes to plan in farming and both parties need to acknowledge this and be prepared to shift expectations
- All parties need skin in the game & to have potential profits
- Keep talking regularly so problems/resentments don't grow
- Understanding that the agreement is not for ever ---it will end at some stage ---as long as this is structured and not sudden there is no problem
Of course...all parties have to be profitableOnly as long as the drip of money lasts