As part of a move away from pure farming, the owners of this business had converted many of their farm buildings into units that offered attractive, yet economical commercial rental units. However, this created a shift in the operational nature of the business and threatened to jeopardise their agricultural status, with inheritance tax consequences. As next generation planning was in place, action was needed.
Whilst there was no need to plan for younger management at this stage, there was a need to keep the wealth within the family and plan for the next generation inheritance. The solution was to hive off the non-farming activities into a new company and to create a shareholding structure involving a trust for the children and grandchildren.
It was necessary to have a brand-new company with a new bank account, directors and financial systems. Playfair Partnerships undertook this task and, using cloud-based accounting software, introduced systems to manage the rents and give joint client and advisor access to dashboard information on rental collections and business performance.
Rental control is at the heart of the financial management, but we also provide all the other important facets of financial control and business planning. The client has anytime access to expertise on all levels, a service that would be beyond them if they had to employ the resource in-house.
Following the reorganisation, the business now generates good profit and cash and is internally investing in growing their rental business. The assets of the non-farming commercial rental business are now ringfenced, mitigating inheritance tax and giving comfort to the next generation. Playfair Partnerships continue to provide financial management and advice.
“Playfair Partnerships have been very successful in cajoling somewhat conservative-minded directors to adopt modern financial management methods, indeed, to enthuse about them. As a result, we have user-friendly cutting-edge accounting information tools in place. This enables us to anticipate any potential financial problems, solve them quickly and develop any possible opportunities for growing the business.” – Managing Director and Shareholder
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