Owning a farm could remove inheritance tax liability Investing in farmland or moving from the big...
Investing in farmland or moving from the big smoke could give some individuals up to 100% Inheritance Tax relief, according to a national accountancy group.
Stephen Torgersen, partner at Torgersens in Sunderland - which is part of the Hacker Young accountancy group - claims anyone with no previous rural connections could see considerable personal and fiscal benefits if they own property on farmland which is used for farming.
According to Torgersen, IHT which might apply to other assets can be reduced by as much as 100% by those qualifying for Agricultural Property Relief, because land with vacant possession or that which has been rented since 1st September 1995 attracts maximum IHT relief.
There is also 50% IHT relief available on other types of land, which can also include land seen as part of a forest or woodland.
"Low produce prices, overseas competition and the widespread general decline in the fortunes of the agricultural sector has inclined investors to look elsewhere for a good return but average land prices are climbing again," says Torgersen.
"You have to look closely at the term 'eligible property'. It may be undeveloped land, a farmhouse, outbuildings and sheds, stud grazing land, woodland or coppices. Sporting right and occupancy conditions should also be considered.
"But if you quite fancy the idea of living in the country and have an interest in the value of your investment when it falls into the hands of the next generation, this is a surprisingly good time to consider planting yourself in greener pastures," he adds.
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