IF someone had asked me 10 years ago whether they should have a lawyer on speed dial, I would have categorically said no.
My response these days would be that you probably need one many years before you think you do.
The need, or potential need, can arise a lot more often than people think.
You service vehicles and machinery, and pay the insurance premiums.
Engaging a lawyer is akin to this in some ways.
Best to put structures, agreements in place, before it hits the fan.
Prevention is better than finding a cure.
In the last 10 years or so I have dealt with lawyers in estate planning, commercial matters, high level tax advice and general legal advice.
This has opened my eyes somewhat.
There are lawyers that run general practices.
There are also specialist lawyers that practice in a particular niche only.
Sometimes the generalist lawyers will refer some matters to specific lawyers that have expertise in a certain area of law.
Most accountants will have some sort of relationship with a law firm.
Often, I see accountants asking for specialised tax advice.
This sometimes includes advice about a private ruling from the Australian Tax Office, if a certain tax strategy is a bit contentious or the law is uncertain.
Succession planning, which also incorporates estate planning, is an area where I think a lawyer is crucial to the process.
An agreement may be hammered out between the parties and hopefully a harmonious outcome is reached.
The agreements need to be drawn up by a legal professional to ensure all parties are contractually bound by the outcome.
This stops, or at the very least, severely curtails any reneging on agreed outcomes.
This can play out where the asset is sold down the track, and it has been agreed prior to the sale (sometimes years before) how the proceeds are to be split.
I have seen this scenario play out a few times.
As the value of farming assets grow (mainly land), it is vital to obtain quality advice on how to protect these assets as best you can.
Also, it is the best way to pass these assets onto the next generation in the most efficient manner.
Succession planning is also a really good time to reset the entity structures if appropriate.
In lots of cases the entity chosen to hold land was historical in nature.
It was the correct structure at the time, but might not be the best way to hold the asset going forward.
Making the investment now will pay dividends down the track.
The true benefits may not be really visible for another generation.
But those that made the effort to obtain quality advice will certainly be pleased they did.
Sometimes I have seen a future tax time bomb averted, as the necessary changes were made by a savvy agribusiness owner at the time.
Estate planning is an area that I think gets scant attention, though deserves much more.
Again, given the size of the assets at play, informed strategies and structures put in place now will pay off in the long run.
I have heard a couple times, comments like: "not my problem, they will sort it out when I'm gone".
Thankfully these types of responses are quite rare, as I believe this is an irresponsible attitude.
As with all long-term decisions in a farming context, the sooner the conversation starts the better, including with a lawyer.
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