The 2011 Census of Agriculture indicated that nearly half of all farmers in Canada are 55 years of age or older. As such, farm succession planning is becoming more and more important.

Your farm may be your most valuable asset and you may rely upon it to fund your retirement and to achieve other financial goals. You may also decide that you’d like to pass your farm to your spouse or children to continue operating what you’ve built. When doing so, it is critical to understand how to do this in a tax-efficient manner so that you minimize your tax liability and maximize your wealth.

 

The Family Farm and Will Planning

As a valuable asset, it may be a part of what you decide to leave to your family upon your passing.

There are ways to integrate your farm into your estate plan so that you can leave your farm assets to your loved ones in a tax-efficient manner. Specifically, there are methods available to you such that upon your passing, your loved ones may be able to receive your farm assets without any immediate tax implications to them or your estate. 

With over 200,000 farms in Canada, farming is an important part of Canada’s economy. As a farmer, it is important to decide how to exit your farm from a tax, retirement and business succession perspective. If you decide to retain ownership of your farm throughout your lifetime, consider planning strategies for the time when your heirs inherit your farm.
If you decide to leave your farm to your spouse or your children, there are tax deferral opportunities available to avoid leaving your estate with a large tax liability. It is important to draft your Will to ensure your farm and other property is distributed according to your wishes on your death.

Through proper planning, with the help of professional legal and tax advisors, you may be able to realize significant tax savings when planning for your future and retirement.

 

When you are ready to take the next step, contact us directly.